Kuehn on Markets

USDA Prospective Plantings

2011-03-31T07:42:00.001-05:00

DJ USDA Report: Summary For Prospective Plantings, Grain Stocks

CHICAGO (Dow Jones)--The following table is provided as a service to Dow
Jones Newswires subscribers in conjunction with the U.S. Department of
Agriculture's prospective plantings and quarterly grain stocks reports.
The reports were released Thursday morning.

Estimates are in millions of acres for 2011 U.S. prospective plantings and
billions of bushels for grain stocks as of March 1.

Prospective Plantings

Thursday's 2010
USDA Average Range Seedings
Corn 92.2 91.662 90.400-92.600 88.192
Soybeans 76.6 76.969 75.000-78.500 77.404
All Wheat 58.0 57.302 56.600-58.400 53.603
Winter Wheat 41.2 41.150 40.500-42.900 37.335
Other Spring Wheat 14.4 13.710 13.000-14.310 13.698
Durum 2.4 2.552 2.400-2.800 2.570
Cotton 12.6 13.12 11.8-13.60 10.97

** In the January Winter Wheat Seedings Report, USDA estimated
2011 winter wheat plantings at 40.990 million acres.

Grain Stocks
2010 2010
Dec. 1 Mar. 1
Thursday's USDA USDA
USDA Average Range Stocks Stocks
Corn 6.52 6.701 6.552-6.800 10.040 7.694
Soybeans 1.25 1.295 1.266-1.366 2.277 1.270
Wheat 1.42 1.399 1.300-1.488 1.928 1.356

Planting Report Comments

2011-03-31T07:35:00.001-05:00

DJ High Prices Drive Corn Planting Up, Soy Acres Slip

By Bill Tomson

Of DOW JONES NEWSWIRES

WASHINGTON(Dow Jones)--U.S. farmers chasing high prices will be planting
92.178 million acres of corn this year, a 5% increase from last year, while
land going into soybean production is expected to slip slightly, the U.S.
Department of Agriculture said Thursday in its annual Prospective Plantings
report.

"Planted [corn] acreage is expected to be up in most states compared to last
year due to higher prices and grower expectations of better net returns," the
USDA said in the report.

The new corn planting forecast is also slightly higher than the 92 million
acres USDA predicted in late February during its annual outlook conference and
surpassed most analysts expectations.

Future prices for corn recently traded above 21/2-year highs on strong global
demand and worries about low supplies.

And the USDA confirmed in a separate report Thursday that there is indeed a
tight market. The Grain Stocks report that showed corn stockpiles across the
U.S. total just 6.52 billion bushels, 15% less than about a year ago on March
1, 2010.

Soybean stockpiles are also lower than a year ago, but the drop wasn't as
steep. Soybeans stocks, whether stored on farms or off, total 1.25 billion
bushels. That's a 2% decrease from the 1.27 billion bushels of stockpiles about
a year ago.

Soybean supplies are still tight though and global demand, especially from
China remains high, according to analysts surveyed by Dow Jones Newswires.
China has become the largest foreign market for U.S. agriculture goods and its
appetite for U.S. soybeans continues to grow.

The USDA predicted Thursday that soybean acreage this year, although expected
to drop about 1% last year, will still be the the third largest planted crop
ever in the U.S.

Farmers are forecast to plant 76.6 million acres with soybeans this year,
down from 77.404 million acres in 2010 and 77.451 million acres in 2009.

But analysts were still expecting the USDA report to confirm that some
farmers are switching soybean acreage over to corn or even cotton, which has
seen strong increases in futures prices in recent months thanks to expected
production declines in China and Pakistan.

Cotton acreage in the U.S. this year is now forecast at 12.566 million acres,
a 15% increase from 10.973 million acres last year, according to the
Prospective Plantings report.

"Cotton acreage increases are expected in every state," the USDA said
Thursday.

The USDA also released an increase in its forecast for the acreage farmers
will plant with wheat. The new prediction is for 58.021 million acres and
that's about an 8% increase above the 53.603 million acres planted this year.

By Bill Tomson, Dow Jones Newswires; 202-646-0088; bill.tomson@dowjones.com

Commodity Roundup

2010-12-13T11:00:00.001-06:00

13 Dec 10
Commodities

Corn
Looks like we are starting to get another wave higher after bouncing off of the 61.8 fib retracement. My swing trade system has initiated long positions. I’d like to see a rally past the 620 high CH11. If that occurs my next upside objective would be 675. Weakness before taking out 620 could spell a new downtrend. I think we have room to run higher.

Soybeans
Similar situation in the beans however last week ended a little weak. The rally needs to take out the high of 1355 to confirm strength. If that happens, my next upside objective would be 1470 SH11. RSI and MACD all are trending higher. Weakness below 1355 could begin a downtrend for the time being.

Wheat
Wheat in both KC and CBT have had a good couple of weeks. We are now up against resistance and overbought. We risk a double top if the market gets weak here which would signal to me a new trend lower. If we rally past the resistance in the face of being overbought, that would indicate pretty good strength.

Cattle
Looks like both feeders and lives are trying to let off some steam from recent strength. From the last wave in the LCJ11 contract we are nearing the 50% correction We are still clearly in an overall uptrend so long as the 104.1 area doesn’t get taken out by weakness. Watch the 61.8% fib (106.382) for market direction. Strength above it buy. Weakness below it sell. RSI and MACD are both trending lower indicating more weakness to come.

Bean Fundamentals

2010-12-10T22:18:00.002-06:00

Here are a few charts based on the recent USDA report data. My general view of the bean market is extremely bullish. We haven't seen such tight numbers right after a harvest in many years.

The first chart is total useage. You can see even with current high prices of 1280 SN11 useage is still smoking the previous four years. In my view even with current high prices we really haven't started rationing supply. With useage so strong here prices will have to surge higher to fight for acres next spring. That says nothing to the fact that we may have potential production problems next year.

Stocks to Use, my favorite fundamental indicator. It's a formula that figures current stocks to current useage. It's a pretty good gauge to how tight supplies are compared to useage. Typically a stocks to use under 7% or 8% is extremely tight. The latest USDA report came in at an amazingly low 4.89%. My records go back as far as early 90s and I've never seen s/u this tight.

Final chart is ending stocks and tells the same story. We haven't seen numbers this tight after a fairly large harvest in many years.

BULLISH BULLISH BULLISH

USDA DEC 2010

Beg. Stocks: 151
Production: 3375
Total Supply: 3536
Total Use: 3371
Ending Stocks: 165
Stocks to Use: 4.89%

FX Roundup

2010-11-29T14:05:00.000-06:00

I am back.

29 Nov 10
FX

USD
The dollar is strong in every cross that I watch. It looks to me like we have a long ways to go before we hit any meaningful resistance to the dollar rally. USD/CAD would be the closest to resistance. The resistance lies around 1.02470. Going through that area would be very bullish for the dollar. We aren’t anywhere near being overbought on the dollar yet. Europe is crumbing. Stay long the dollar.

AUD
Confirming weakness all over the place. AUD/JPY cross looks like a double top and AUD/USD, AUD/CAD both have nice head and shoulder tops. RSI and MACD both confirm a bearish tone. The only AUD cross that is holding its own is the EUR/AUD. The EUR is obviously the weaker of two. I put on double the short lots with the AUD/CAD and AUD/USD. I just can’t ignore the head and shoulder tops.

GBP
Although not nearly as weak and the Euro still pretty weak against the two pairs I watch. GBP/USD has broken some support and continues to fall. I have 1 lot shorted here but would love to see a brief rally to get aggressive about selling more. The Yen pair looks a lot weaker moving forward as it tested resistance and failed to move above it at 123.2. Bottom line here is as long as Europe looks to be in trouble, and it will for along while yet, the Pound is going down.

EUR
There’s not a lot to say about the Euro other than to sell the crap out of it. There’s lots of broken support all over. The EU debt woes will bring the EUR down for quite a while. The Euro against any pair is in terrible shape.

JPY
The Yen is in decent shape except against the USD. The AUD/JPY is going lower off of a double top. The EUR/JPY broke pretty strong support at 111.9. GPB/JPY looks like it will now resume a downtrend after a month long correction higher. The only bearishness is with the USD/JPY and that pair really could use a correction before I would buy into the dollar against the USD. I have a light bullish position in the USD.JPY

Swing Update

2010-10-03T19:54:00.001-05:00

Current Swing Open Trades
Instrument Status Month Entry Date Entry Price Stop
Live Cattle Short Dec 29 sept 10 98.55 99.95
Corn Short Dec 10/3/2010 460.5 509.25
Lean Hogs Short Dec 29-Sep-10 75.75 75.17
Soybeans Long jan 30-Sep-10 1112.25 1080
CBT Wheat Short Dec 22-Sep-10 721.00 687
Oats Long Dec 30-Sep-10 340.00 324
Feeder Cattle Long Jan 30-Sep-10 113.000 110.2
KC Wheat Short Dec 24-Sep-10 740.000 731.5

Recent Swing Closed Trades
Instrument Status Month Entry Date Entry Price Exit Date Exit Price P/L

Live Cattle Short Dec 22-Sep-10 99.35 28-Sep-10 99.85 $200.00
Lean Hogs Long Dec 3-Sep-10 74.50 28-Sep-10 75.7 $480.00
Corn Long Dec 27-Aug-10 432.00 29-Sep-10 490 $2,900.00
Oats Long Dec 26-Sep-10 352.00 29-Sep-10 333 -$950.00
Soybeans Long Nov 27-Aug-10 1015.50 29-Sep-10 1089 $3,700.00
Feeder Cattle Short Jan 1-Sep-10 114.600 30-Sep-10 111.9 $1,350.00
Live Cattle Short Dec 29 sept 10 98.55 10/1/2010 99.95 -$560.00

Swing Update

2010-01-25T20:12:00.002-06:00

The past few trading days has seen the swing closed profit/loss go from down about -1200 bucks to now up 2185.

Today we were stopped with gains out of the feeder cattle and hogs.

Currently, the swing is short Corn, CBT Wheat, Soy Meal, Soy Oil, and Soybeans for a open p/l of +8800 bucks. Very very nice start to the year.

The Forex market I am up 691 pips for the year. Another good start.

Swing Update

2010-01-19T18:32:00.003-06:00

Here's a list of all the current open positions. Some of these are real trades for me. Open positions are booming at 12508.50 gain while everything closed comes in at -2800. Let's hope some of these big open winners translate into big closed winners.

COMMODITIES
OPEN
Instrument Status Month Entry Date Entry Price Stop
Corn Short Mar 12-Jan-10 384.50
Oats Short Mar 12-Jan-10 252.75
Soymeal Short Mar 11-Jan-10 298.70 293.6
Soy Oil Short Mar 11-Jan-10 39.50
Soybeans Short Mar 11-Jan-10 1024.50
CBT Wheat Short Mar 15-Jan-10 525.25
Feeder Cattle Long Mar 28-Dec-09 94.95 97.175
Live Cattle Long Feb 13-Jan-10 86.00
Lean Hog Long Feb 13-Jan-10 69.08

TOTALS
OPEN TOTAL P/L: $12,508.50
CLOSED TOTAL P/L: -$2,842.00

FOREX
The forex swing is doing good as well. These are live trades. Current open positions are showing +642 pip gains. Closed positions are coming in at +489 pip gain. Biggest winner so far in the British pound long at +204 pip gain. Biggest loser right now is the Long GBP/CAD showing -7 pip loss. That trade was entered just a hour ago.

Morning Call

2010-01-07T08:24:00.004-06:00

I'm loafing a little before I have to scoop the global warming out of the bunks.

Grains are much lower overnight. I haven't really heard why yet. Beans down 14 corn down 4 wheat down 5 as of this posting.

A few observations with the grains is that we are very near resistance especially the corn. It almost looks like a triple top at the ch 425 area. It's something to watch if we go through it or get weak.

Beans all ready have a 1-2-3 top going even though it has been going up the past couple of weeks. If I were a wave trader, I'd be looking at finding my shorts.

My thinking on the wheat is that it is trying to bust out an uptrend here. MACD is trending up, RSI is trending up, the trend looks like it's up.

Swing Update

2010-01-04T06:28:00.004-06:00

Good Morning

Can't wait to get this new year of trading underway.

Swing Update

Commodity
The swing is long everything except live cattle and hogs but will be long those markets today as well. Here are the entries and stops if placed:

Mar Corn @ 403.25 stop 399.5
Mar Oats @ 265
Mar SoyOil @ 307
Mar Beans @ 1043.5
Mar CBT Wheat @ 543.75
Mar Feeder Cattle @ 94.95 Stop 94.15
Feb Cattle @ open today
Feb Hogs @ open today

Total Open Trades P/L is 1294.

Forex
Long AUD/JPY @ 81.33
Short EUR/AUD @ 1.6067
Long NZD/USD @ .7259
Short USD/CAD @ 1.0485 stop @ 1.058
Long USD/JPY @ 89.8 stop @ 99.1
Short EUR/GBP @ .8944
Long EUR/JPY @ 131.26
Long GBP/JPY @ 146.92 stop @ 145.99

Total Open Trade pip gain is 1495 pips!

Battle of Strategies

2009-12-10T20:28:00.004-06:00

Ok, something that I am really excited about and kind of fun to track because I'm a mega geek: I challenged a buddy and distant cousin-in-law, who just so happens to work for B4 grain in Kearney, to a battle of grain selling techniques.
We started the challenge October 1st and it will run until Oct 1st of next year using December 2010 corn and November 2010 beans. The challenge is between my RSI Cash Sales technique, and B4 Grain's Market Power. The challenge covers both beans and corn. The winner must win both commodities to win the bet. The terms are: if I win I will receive B4 Grain’s Market Power newsletter for a year. If I lose, I have to pay for the newsletter for a year.
Here are the totals so far:

ME
Corn
40% Hedged @ 4.2828
Beans
20% Hedged @ 10.142

B4 Market Power
Corn
40% Hedged @ 4.304
Beans
40% Hedged @ 10.138

2009-11-12T10:44:00.001-06:00

Gold oil getting weaker. Dollar up. Beans poppin a little but corn refusing to go up. Decent sign lower.

Weekend Review

2009-11-08T14:07:00.003-06:00

DEC LIVE CATTLE
No Trend
RSI Trending Lower
MACD bearish cross
Nearest Support 83.425
Nearest Resistance 88
Bias: The potential is there for a 1-2-3 bottom, but we need to see strength without seeing support broken.

DEC HOGS
Hogs are in need of correction lower, but the trend is still up.
Trend is up
RSI trending lower from overbought levels
MACD bearish cross
Nearest Resistance 58.4
Nearest Support 52.225
Bias: With indicators coming off of overbought levels and showing a little weakness, long should be on the defensive. The trend is up however, look to continue buying.

MAR SOYBEANS
I’m now watching March Soybeans. Mar beans on Friday confirmed a bearish A-B-C top. Look for pressure.
Trend is Down
RSI is trending lower
MACD bearish cross
Nearest Support 891 (Double Bottom)
Nearest Resistance 1025
Bias: Given all the indicators have turned bearish along with a confirmed ABC top. Sell

DEC CORN
We have gotten our wave 4 correction lower, but possible bearish top is looming.
Trend is Up
RSI is trending lower
MACD bearish cross
Nearest Support 358.75
Nearest Resistance 413.5
Bias: Depends on the breakout. A break of either resistance or support should reveal direction. A break of support will confirm the A-B-C top and trend lower. A break of resistance will be a wave 5 trend continuation signal.

2009-11-05T10:48:00.001-06:00

Gold up dollar down yet grains are weak. R we finally trading fundamentals?

2009-11-04T11:49:00.001-06:00

Grains slightly lower with gold oil up and dollar down. If dollar started to get strong here thatd be bad news for grains.

Cash Grain Sales Update

2009-11-01T13:53:00.003-06:00

Friday gave us a sales triggers on almost everything we watch.

Both Old and New Crop for 2009 and 2010 corn. Also, Old and New Crop 2009 and 2010 Soybeans.

Dec 2009
2yr Hedge = 575 100% sold
1yr Hedge = 413 100% sold

Jul 2010
2yr Hedge = 619.605 100% sold
1yr Hedge = 366.075 100% sold

Dec 2010
2yr Hedge = 414.2 100% sold
1yr Hedge = 0% sold

Jul 2011
2yr Hedge = 421.925 60% sold
1yr Hedge = 0% sold

Soybeans
Nov 2009
2yr Hedge = 1211.15 100% sold
1yr Hedge = 913.65 100% sold

Nov 2010
2yr Hedge = 907.85 100% sold
1yr Hedge = 0% sold

Swing Trade Update

2009-11-01T10:44:00.002-06:00

All of the original long positions the past week or two have been switched to shorts except for Dec Hogs.

Feeder Cattle is the only swing market I'm watching without a position. It is very very close to selling however.

Monday the swing will be shorting Dec Cattle.

Total closed positions to date have yielded $5816 dollar gains! Let's trade this for awhile and see how severe the draw down will be. As with most trading systems, there will be a draw down. Hopefully we can limit the losses and let the profits roll.

Here is the current positions:

Long Dec Hogs @ 53.675 Stop @ 54.65
Short Jan Soybeans @ 976.5 Stop @ 1030
Short Jan Soy Oil @ 37.18 Stop @ 39.5
Short Mar Oats @ 262.25 Stop @ 282
Short Mar Corn @ 390 Stop @ 425
Short Jan Soy Meal @ 287.5 Stop @ 302
Short Mar Sugar @ 23.08 Stop @ 25
Short Dec CBT Wheat @ 496.75 Stop @ 576

Total Closed Gain/Loss = $5861

Morning Call

2009-10-28T08:24:00.001-05:00

Morning Call

Grains look to be in an honest correction lower from recent rally. Last night Dec corn down 5.75 Nove beans down 11 KC wheat down 3.5 and cbt wheat down 10. Cattle showing a little strength.

Corn and wheat yesterday confirmed an evening star which sets up a corrective decline. Keep a close eye out on support levels for keys to an end of the decline. In corn this is most likely a corrective wave within a larger rally. Wheat has yet to hammer out a true base for a rally. Bulls stay on the defensive for now.

Beans like wheat really needs to put together some sort of 1-2-3 bottom before im confortable with any rally attempts. If the double bottom in the Nov beans and holds, I think we have a decent base to establish a rally. Bulls stay on the defensive.

Lots of action in the swing trade yesterday.
Yesterday we were stopped out of Soybeans, Soy Meal, and CBT Wheat all decent gains. For new open positinos we shorted Oats, Corn, Soy Meal, and sugar. Today we will be adding a short Jan beans.

General Update

2009-10-27T08:15:00.003-05:00

Just a quicky this morning:

A chart pattern I watch out for regularly called star formations. They have a pretty good track record of finding short term tops and bottoms in markets.

This morning I'm seeing several evening stars which are bearish:
Dec Corn
Dec Soy Meal
Dec CBT Wheat
Dec Lv Cattle

All of these markets have that pattern. To confirm this bearish formation watch for prices to break yesterday's lows. If that happens, I would be on the short side or defend any longs. Possibly we are in for a correction here.

Swing Trade Update
One new trade will occur today. Short March Sugar with a stop @ 24.80.

Weekly Outlook Chartbook

2009-10-25T19:23:00.003-05:00

Dec Hogs
Trend is up
RSI overbought.
MACD bearish cross.
Neartest Support: 47.5
Nearest Resistance: 54.95
Bias: Look for correction lower wave 4 then continued uptrend wave 5.

Dec Live Cattle
No Trend
RSI overbought.
MACD Bullish Cross
Neartest Support: 83.45
Nearest Resistance: 87.6 area
Bias: Wave 1 strength may continue for now. Possible correction wave 2 lower near.

Dec CBT Wheat
No Trend
RSI overbought.
MACD bullish cross.
Neartest Support: 440
Nearest Resistance: 584.5
Bias: Wave 1 strength may continue for now. Possible correction lower to establish uptrend soon.

Nov Soybeans
Trend is up
RSI overbought.
MACD bullish cross.
Neartest Support: 882 double bottom
Nearest Resistance: 1020.5 area
Bias: Wave 1 strength should continue. Look for possible correction lower then continued uptrend soon.

Dec Corn
Trend is up
RSI overbought.
MACD bullish cross.
Neartest Support: 313
Nearest Resistance: 474
Bias: Look for current wave 3 strength to continue for now. Watch for corrective wave 4 to develope shortly.

Cash Grain Sales

2009-10-22T13:45:00.004-05:00

RSI Strategy

Sales History (Futures)

Corn
Dec 2008
2yr Hedge = 409.65 100% sold
1yr Hedge = 644.025 100% sold

Dec 2009
2yr Hedge = 575 100% sold
1yr Hedge = 413 100% sold

Jul 2010
2yr Hedge = 619.605 100% sold
1yr Hedge = 366.075 100% sold

Dec 2010
2yr Hedge = 414.2 100% sold
1yr Hedge = 435 0% sold

Jul 2011
2yr Hedge = 432 50% sold
1yr Hedge = 455 0% sold

Soybeans
Nov 2009
2yr Hedge = 1211.15 100% sold
1yr Hedge = 913.65 100% sold

Nov 2010
2yr Hedge = 907.85 100% sold
1yr Hedge = 988 0% sold

These prices are based off of a RSI sales strategy I use for cash sales. If you want more info please email me.

Swing Trade Update

2009-10-22T10:36:00.004-05:00

The recent grain rally has really made some these trades golden.

$ Jan Soybeans, Long @ 937.75, Stop @ 957, P/L $3600
$ Dec Soymean, Long @ 290, Stop @ 290, P/L $870
Dec LeanHogs, Long @ 53.675, Stop @ 52, P/L $0
$ Dec CBT Wheat, Long @ 464, Stop @ 482.5, P/L $3925
$ Dec Lv Cattle, Long @ 84.65, Stop @ 85.2, P/L @970
$ Jan Fdr Cattle, Long @ 95, Stop @ 95.325, P/L $862.50
$ Jan Soy Oil, Long @ 36, Stop @ 36.94, P/L $1836

Total Open P/L $12,063
Total Closed P/L $0

If a $ sign is posted before the entry that means I have locked in a profit. This is a swing trading system. Results are hypothetical. Trade at your own risk. If you'd like to see details on this trading scheme please e-mail me.

Mid Week Thoughts

2009-10-14T13:18:00.001-05:00

Grains have come under pressure at the moment today after what I thought was a pretty good morning. CBT wheat was up almost 20 cents but now trading 3 lower.
The one thing that worries me about the latest rally is that we are going into harvest. Markets tend to overreact when it comes to apparent production disasters. I think there is damage done, but we have to look at the big picture in that it was a monstrous crop to begin with. Short term I’m a little bearish here. Long term I’d buy on any dips and hold.

AG
CornCorn 2 cents lower now and really looks like it needs a correction lower before continued strength. If you take the June high and the September low the market is nearly at that 50% market which might be pretty good resistance. If you’re long I’d be a little defensive with my positions.
Soybeans
Again, nice morning rally but it’s starting to fade. 1018 sx9 offers some resistance. By my rules of engagement we aren’t in a rally yet even though we have rallied. I’d still look to sell on weakness. If we get weak and 880 is tested or holds on any decline, yes then I will label it a rally. Not yet. I’d look at the 945 area for a good target with a decline. That offers some support and around the 50% retrace.
Wheat
Wheat is not overbought yet but is near resistance. It’s still in a downtrend until support is tested and holds. Not sure if we are hammering out a bottom yet or not.
Cattle
Market is starting to see a dollar rally in both live and feeder cattle. It’s been oversold for awhile and needs at least a correction. Still in a downtrend which means rallies ought to be sold. There’s not too much resistance overhead. I’d target the 98 50% retrace in the Dec..

Forex
In general i’d really hate to be short gold or silver or any commodity in general. Hyper inflation here we come. I’m betting against the dollar.
Gold
I’m watching the 15 min charts and we’ve broken out of a 1-2-3 bottom pattern. So that is confirmed.
Euro
At the moment new yearly highs. Long long long.
Auzzie Dollar
Same thing as Euro although we are getting a little overbought. Watching for the swing to TP longs maybe, but buy the dips.
Cable (Pound)
The only thing that scares me about buying this currency is the head and shoulder top the pound created during the summer months. Maybe we rally here, but I’d lightly short the rallies. Still in a downtrend.
Canuck Dollar
Oversold due for a correction, but here again bet against the dollar and sell this pair on rallies.

Swing
The swing trade has added a few positions. The scheme is now long both feeder cattle and live cattle. 95 entry on the Jan feeders and 84.95 on the Dec live.

Swing Trade Update

2009-10-12T08:11:00.003-05:00

Here's the results of a new scheme that I'm trying.

Swing Trades

Long Jan Soybeans @ 937.75 Stop @ 885 Fense Dec 880p @ 14'

Long Dec Soymean @ 209 Stop @ 266.5 Fense Dec 270p @ 3

Long Dec Lean Hogs @ 53.675 Stop @ 47.3 Fense Dec 47p @ 1.0

Long Dec Wheat @ 464 Stop @ 438.5 Fense Dec 440p @ 10.5'

Morning Call

2009-10-12T07:56:00.003-05:00

Overnight grains were solidly higher. Corn up 10 cents. Beans up 17 cents. Wheat up 11 cents. The dollar is lower. Crude up 1.37 and gold up 7 bucks an ounce.

Corn
On the hourly chart corn is right on resistance anywhere from 370 to 373. Next area to target is 377. That's really the last area or resistance until the contract highs of 470. The market is overbought due for a correction, but being in an uptrend dips lower should be bought.

Beans
Beans are solidly in an uptrend with no overhead resistance on the hourly. 976 offered some resistance on the dailys but was taken out last night. Let's see if the day trade can continue that push. After that 1017 would be next area to target. The market is not in an uptrend yet, but has taken out the first of two downtrend lines. Look to short on some weakness.

Wheat
Hourly shows an uptrend but is in conflict with daily charts. 482 offers resistance and then 518. Remain a seller.

OCT USDA Report

2009-10-11T20:33:00.002-05:00

Friday's USDA Grain Numbers Run down

Corn
Production 13018 up from 12954 -Bearish
Total Supply 14702 up from 14660 -Bearish
Total Use 13030 up from 13025 -Bullish
Ending Stocks 1672 up from 1635 -Bearish
Stocks/Use 12.83% up from 12.55% -Bearish

Stock to Use ratios indicates a tight supply situation. This looks like it will be the 2nd largest crop in at least ten years, but this will also be the 2nd year in a row were usage is greater than our production. I think the future looks very bright for the corn market long term. The last time we saw a year over year usage outpace production was 2001-2003 and parts of 2004. Those years say a 50% increase in price. If we were to apply those same rules, 7 dollar plus is a reasonable target next year.

Beans

Production 3250 up from 3245 - Bearish
Total Supply 3398 up from 3366 - Bearish
Total Use 3169 up from 3145 - Bullish
Ending Stocks 230 up from 220 - Bearish
Stock/Use 7.26% up from 7% - Bearish

Stocks to Use ratios indicates a very tight supply situation. Although with such tight ratios the funamental picture is slightly less bullish than corn. Production is estimated to keep pace of usage.

2009-09-11T07:57:00.002-05:00

Report might give a boost to the ratio spreads given the expectations of the report and how it actually turned out.

Report Stocks/Use

Beans 6.9% Extremely Tight
Corn 12.5% Tight/Adaquate

Big Nebraska Crop

2009-09-05T19:34:00.000-05:00

Dan Davidson DTN Agronomist
Bio Email
Tuesday Aug 18, 2009
Nebraska Corn Crop
Pro Farmer editor Chip Flory said “Nebraska’s corn crop is big and by far the best corn crop I’ve ever seen in Nebraska.” And this sentiment was echoed by all the crop scouts in walked corn fields in Nebraska the last two days.
Flory pointed out that ear counts were up significantly in Nebraska this year, roughly 15 ears in 60 foot of row length and ears were a half inch longer on average. Yet girth (rows around) was down slightly at 15.94 rows around compared to 16.29 in 2008.
Along my own tour route paralleling I-80 and about 30 to 40 miles to the south, we had ear count of 90 to 120 in 60’ of row in irrigated corn. And in my 6 years on the tour I have seen nothing like it. However the dryland corn I sampled had ear counts of 60 to 80, still good, but not stupendous.
But the big kicker is the average estimated yield of 158.69 bushels compared to 141.82 bushels in 2008 – which by all measure was the second best crop in Nebraska after 2004 (143 bushels).
Flory pointed out that they routinely underestimate Nebraska yield by about 16 bushels because of sampling time (early) and how they sample irrigated vs. dryland fields (all done at random). So if you add that 16 bushels back into 158 bushel crop, the average yield could hit 172 to 175 bushel. “That is a whole lot of bushels,” said Flory.
The big kicker is ear count and they are up significantly and we can contribute that to very ideal planting conditions and early planting.
The story with soybeans is pod counts and they are up. Cool weather and ample moisture has produced significantly more pods and now we just need the time and moisture to fill them out and particularly in the north. We definitely need a full September to finish out corn and soybeans..
Nebraska has a great crop. Planting went off without a hitch and there has been plenty of timely rains across the state and recording setting cool weather. However the northern half of Nebraska is 10 to 14 days behind schedule with the corn in the milk stage. However corn south of I-80 is maturing and is rapidly completing dough stage and should black layer in 2-3 weeks. Yield in southern Nebraska is already made.
Corn in northern Nebraska was clean of disease and in good conditions albeit for hail damage and being behind while in southern Nebraska has suffered from hail, gray leaf spot, anthracnose, and wind damage. This would have been the year to spray a fungicide and fields that were obviously sprayed were clean.
This will be the year to watch what farmers are corn yields farmers are pulling down beginning a short 6 weeks from now. Pro Farmer editor Chip Flory said “Nebraska’s corn crop is big and by far the best corn crop I’ve ever seen in Nebraska.” And this sentiment was echoed by all the crop scouts in walked corn fields in Nebraska the last two days. Flory pointed out that ear counts were up significantly in Nebraska this year, roughly 15 ears in 60 foot of row length and ears were a half inch longer on average. Yet girth (rows around) was down slightly at 15.94 rows around compared to 16.29 in 2008. Along my own tour route paralleling I-80 and about 30 to 40 miles to the south, we had ear count of 90 to 120 in 60’ of row in irrigated corn. And in my 6 years on the tour I have seen nothing like it. However the dryland corn I sampled had ear counts of 60 to 80, still good, but not stupendous. But the big kicker is the average estimated yield of 158.69 bushels compared to 141.82 bushels in 2008 – which by all measure was the second best crop in Nebraska after 2004 (143 bushels). Flory pointed out that they routinely underestimate Nebraska yield by about 16 bushels because of sampling time (early) and how they sample irrigated vs. dryland fields (all done at random). So if you add that 16 bushels back into 158 bushel crop, the average yield could hit 172 to 175 bushel. “That is a whole lot of bushels,” said Flory. The big kicker is ear count and they are up significantly and we can contribute that to very ideal planting conditions and early planting. The story with soybeans is pod counts and they are up. Cool weather and ample moisture has produced significantly more pods and now we just need the time and moisture to fill them out and particularly in the north. We definitely need a full September to finish out corn and soybeans.. Nebraska has a great crop. Planting went off without a hitch and there has been plenty of timely rains across the state and recording setting cool weather. However the northern half of Nebraska is 10 to 14 days behind schedule with the corn in the milk stage. However corn south of I-80 is maturing and is rapidly completing dough stage and should black layer in 2-3 weeks. Yield in southern Nebraska is already made. Corn in northern Nebraska was clean of disease and in good conditions albeit for hail damage and being behind while in southern Nebraska has suffered from hail, gray leaf spot, anthracnose, and wind damage. This would have been the year to spray a fungicide and fields that were obviously sprayed were clean. This will be the year to watch what farmers are corn yields farmers are pulling down beginning a short 6 weeks from now. ' type=hidden name=article>

2009-08-25T09:52:00.001-05:00

Yesterdays bean close was strong sending rsi into a buy trigger. Exit or hedge those shorts.

2009-08-20T10:02:00.001-05:00

Watching the euro and pound. Pretty good bearish divergance in the macd. Working the shorts.

2009-08-19T20:39:00.001-05:00

This is a test message from phone.

Morning Markets

2009-06-22T07:36:00.002-05:00

This morning grains are lower corn down -10, beans down -16, cbt wheat down -9. The dollar is higher, crude is lower, and gold is also lower. So outside markets look to weaken grain.

All in all I'm a buyer of this correction lower. The uptrends may have been violated, but we are definitely not in a downtrend yet.

Corn
In my view this current down market is a correction within a larger trend higher. As long as we maintain above 380 in the September 390 in December, I think we will have higher prices to sell later. Anything is a guess as we are in a weather market. Technicals are getting oversold here.

Beans
Like corn beans are in a down market that is simply a correction in a larger trend higher. We've been on overbought status for awhile and needed this correction. As long as we maintain 990 old crop or 890 new we are still ok.

Wheat
Same picture here, but given the fundamental nature of the current supply, and the huge break from higher prices, I'm not too bullish wheat. I'm looking for a move higher to begin selling. The market is oversold and due for a bounce higher, but I'd look to sell that bounce.

Technically Grains

2009-05-03T18:17:00.007-05:00

CORN cn9

Corn is wishy washy. If rally has legs 418 needs to be taken out.

Time is now for corn. Prices are up against resistance, and any rally attempt will need to show strength above it. RSI, MACD, and a breakout of triangle all say higher. It's getting hard to sell.

SOYBEANS sn9

The sky seems to be the limit......for now.

Last week's trade pushed through a new high in the rally. Buy the dips.

CBT Wheat wn9

Much like corn it's time for wheat to shit or get off the pot.

All the indicators are pointing higher, but 581 resistance needs to be taken out soon.

End of the Week Grain Chart

2009-04-17T21:48:00.007-05:00

Corn ck9

The week ended with trend violation: sell any bounce higher.

Friday closed out the week with a trend violation which ends the brief rally corn has had over the past month and half. Including the violation MACD indicator shows a nice short patter with RSI trending below 50%. We're not oversold yet, but any bounce followed by weakness should be sold.

Beans sk9
RSI is overbought. Expect a correction lower but continue to buy.

Long term weekly chart shows a confirmed 1-2-3 bottom.

CBT Wheat wn9

It's do or die for wheat. Will support hold?

USDA Supply and Demand Report

2009-04-09T11:35:00.002-05:00

Final numbers for the 2008 crop

US Corn:

Beg. Stocks 1624
Production 12101
Total Supply 13740
Total Use 12040
Ending Stocks 1800
Stock/Use 14.12%

From last month they increased usage slightly and decreased ending stocks slightly.
Stocks/Use fell to 14.12% from 14.5%. Overall not a big change.

US Beans:

Beg. Stocks 205
Production 2959
Total Supply 3176
Total Use 3011
Ending Stocks 165
Stock/Use 5.48%

From last month they increased usage and decreased ending stocks in an all ready tight suppoy. Stocks/Use fell to 5.48% from 6.19%. These are very tight numbers.

Bullish Grains

2009-04-06T23:42:00.005-05:00

New Crop CBT Wheat
Double bottom and confirmed breakout to the top.

Front Month Beans

Another trend violation and confirmed 1-2-3 bottom.

Front Month Corn

After a trend violation and now a confirmed 1-2-3 bottom, corn has created a new uptrend.

Getting Worried About Beans

2009-02-14T15:39:00.001-06:00

The report on Monday was bullish overall. Stock/Use ratios went back to very very tight levels, but the market didn't react favorably. We've had a correction higher since early December. Was that little rally just a correction in a bear market? Technically it's shaping up to be a bear.

Bullish Cattle - Technical

2009-02-08T15:46:00.001-06:00

It's my first post in a very long time so here goes.....

It's looking like a bull in cattle:

The Report Report: Bearish Beans?!!

2008-04-10T14:44:00.001-05:00

The 2007 crop year final numbers came out yesterday which painted a pretty tight supply situation for all the grains. I had to laugh at the commentators on the radio claiming the report was "bearish" beans. It wasn't bearish by any means just the fact that the report was above the trade guess on supply. Make no mistake about it, we are extremely tight and have no room for error this season.
Corn:
US SUPPLY (millions of bushels)
Beginning Stocks: 1304
Production: 13704
Total Supply: 14393
Total Use: 13110
Ending Stocks: 1283
Stocks to Use: 9.7%
The report increased usage and decreased Ending Stocks. That's an extremely bullish situation if you think about it. Either the USDA is yanking our chain or we really did increase usage at these price levels. Going into the report and having a bearish usage bias at these price levels, I was totally expecting usage to go lower. I've been trading the 2008 Dec/July bear spreads for awhile now. A stocks to use under 10% has me seriously thinking I should exit those positions. The 2009 bull spread Jul/Dec looks to stampede even at the spread's current high level at 58.

Beans:
US SUPPLY (millions of bushels)
Beginning Stocks: 574
Production: 2585
Total Supply: 3189
Total Use: 3009
Ending Stocks: 160
Stocks to Use: 5.3%
The report increased (very slightly) supply and ending stocks while decreasing (slightly) Usage. The report may have shown a slightly bearish tone to the bean fundamentals, but make no mistake about it. 5.3% stocks to use is crazy tight. If there is any weather scare this season, and you know there will be, I don't see how 15 dollar beans will hold it. The 2008 Jul/Nov bull spread has come down now under 100. Although realitively high, I would look to start entering that spread again. Increase 2008 crop year supply while 2007 crop year supply is so very tight and 200 might not hold that spread.

Weekly Chartbook

2008-04-06T15:52:00.001-05:00

The chartbook has been updated to reflect last week's price action. A look at trends and indicators for:
Corn
Beans
KC Wheat
Live Cattle
Lean Hogs
chartbook

The Website Change

2008-04-02T07:59:00.001-05:00

I’ve changed things up a little bit. If there’s something you want to see added, changed, or whatever, let me know and I’ll see what I can do. Here’s what the website provides.Please note: Some of these pages have not been completed and are under construction.

Chartbook: Depending on my schedule, this is a weekly technical view of the trends, patterns, indicators, and my long/short term bias of a few markets that I follow. I am a trend trader. I rarely can pick tops bottom with any accuracy. I establish where the trend is going and hop on the train. The chartbook is geared towards this type of trading.

Spreads In Play: Spreads are a powerful part of trading. They can tell you a lot about the current trade sentiment and follow fundamentals pretty well. In volatile times I have really leaned on spreads to trade. They are less volatile, require less margin, and they can provide a pretty nice return for the portfolio. 90% of my trades are spreads. This section details the spreads I have money in and am watching closely.

Research: Results and/or data of trading research I’m experimenting with. Whether it is a new indicator I’m trying out, a new hedge method, or figuring out the best seasonal for a certain spread, this is where I’ll post my results.

Strategy: A list of proven strategies in trading.

Grain Statistics: A list of government reports and current fundamental data on the grains.

Cash & Basis: A lot can be gleaned by watching prices trends. In the long term, markets are driven by supply and demand. You can get a pretty good idea of demand by watching the cash market. If the cash market takes a dive at certain futures level, you know that a drop in futures may be on the horizon.

Need to Know: Here’s a detailed look at all the patterns and indicators I watch for. If you see that I have posted in the chartbook of a 1-2-3 top in corn but don’t know what it is, go here.

Tools: A list of often visited websites to aid me in my trading decisions.

FX Roundup. Exactly like the chartbook but only with currencies. Currencies, I love to trade them. I don’t make a whole lot trading them…..yet, but they are really fun to trade.

Spreads In Play: The Corn Bean Ratio / Spread

2008-03-31T20:44:00.001-05:00

The planting intention report is out. The dust has settled, is corn is the new top dog?
A look at the corn bean ratio, and why I'm looking at buying beans and selling corn.
Spreads In Play HERE

The Report Report: More Beans Less Corn

2008-03-31T07:36:00.001-05:00

Corn Called 20-30 higher, Beans Down 40-50, Wheat Down 5 - 10
WASHINGTON (DTN) -- U.S. farmers plan to plant 11 million more acres to soybeans and cut corn area by 7.6 million acres, USDA reported early Monday.
If realized, that would mean 74.8 million acres of soybeans and 86.0 million acres of corn this year.
All wheat acreage is projected to increase to 63.8 million acres, up from 60.4 million acres in 2007. Cotton acreage is projected to decline to 9.4 million acres, down 2.8 million acres from a year ago.
The soybean acreage is more than a half million acres more than the highest pre-report estimates, while the corn total is nearly a million and a half acres below the average guess.
For the five crops -- soybeans, corn, wheat, sorghum and cotton -- acreage is projected to total 241 million acres, up nearly 2 percent from last year and almost 3 percent above the 5-year average. If realized, the cotton acreage will have dropped to the lowest level since 1983.
USDA also reported stocks of grain as of March 1. Corn stocks totaled 6.860 billion bushels, up 13 percent from March 1, 2007, and below the low end of trade estimates. Soybean stocks totaled 1.428 billion bushels, down 20 percent from a year ago but above the high end of estimates. All wheat stocks fell to 710,000 bushels, down 17 percent from a year ago but above most trade guesses.
For the corn, USDA said expected acreage is down in most states, with the biggest reduction expected in Iowa, where corn is expected to be seeded on 13.2 million acres, down a million acres from last year. Indiana and Minnesota are each expected to cut corn acreage by 800,000 acres.
Soybeans are expected to gain acres in every state but West Virginia. The largest increases are expected in Iowa and Nebraska, up 1.25 million acres and 1.20 million acres respectively. Increases of 800,000 acres are expected in Indiana, Minnesota and South Dakota. Record high soybean plantings are expected in Kansas, New York and Pennsylvania.
For the wheat, USDA raised its expectations for the winter wheat crop size slightly, with increases mainly in soft red winter areas. Spring wheat acres are expected to increase 8 percent over a year ago, with biggest increases expected in the Dakotas and Minnesota.
Assuming trendline yields of 155 bushels per acre for corn, harvested acres at 92 percent for corn, and beginning stocks of 1.438 billion bushels and total demand of just over 13 billion bushels, according to studies prepared earlier by DTN contributing analyst Joel Karlin, today's numbers imply a 2008/09 ending corn stocks of 800 million bushels.
For soybeans, assuming trendline yields of 42 bushels per acre, harvested area at 98.5 percent, beginning stocks at 140 million bushels and demand at 2.950 billion bushels, Karlin's tables would indicate 2008/09 ending stocks of 224 million bushels.
The operative word, this early in the season, of course, is "assumptions." It surely won't take long for analysts and traders to raise questions about the accuracy of the government's projections.
One of the first considerations could well be the weather, and how conditions have changed even since the survey was conducted in the first two weeks of March.
"Wet and cool weather during March may wash out any notable impact from Monday's acreage intentions report, due to building concerns about field work delays forcing acreage changes already this season," said DTN Meteorologist Bryce Anderson ahead of the report. "The likelihood that field work will not even get started in the eastern Midwest and Delta until mid-April at the earliest points to corn planting being very late this season. Southern producers, especially, are likely to seriously consider switching out of corn into soybeans or cotton, in order to avoid planting corn which would be pollinating during the heart of the summer--when temperature stress would be at its strongest level."

Spreads In Play

2008-03-30T14:19:00.001-05:00

A look at some bear spreads:

cn8/cz8 bear spreads
cn9/cz9 bear spreads

Click here to see, or the link above.

Weekly Chartbook

2008-03-30T10:57:00.001-05:00

The Chartbook has been updated for the week. click here to see or click the chartbook buttom on above menu.

A look at the trends for:

Corn
Beans
KC Wheat
Live Cattle
Hogs
Eurodollar

A Look at the Trends

2008-03-26T07:29:00.001-05:00

July Corn
June Live Cattle
July Beans

Morning Call

2008-03-17T08:16:00.001-05:00

Grains overnight were mostly lower except for wheat. July Corn - 2.75 @ 568.5, Dec Corn - 3.5 @ 571.5, July Beans - 10.25 @ 1358.5, Nov Beans - 11.5 @ 1267.5, KC July Wheat + 12.75 @ 1173. Calls are in line with the night trade.
Cattle are called mixed Hogs steady to weak.

NEWS
Hogs Collapse, Most Live Cattle Weak
Dollar sell-off gathers pace
Bear rescue spooks markets

Weekly FX Roundup

2008-03-09T17:53:00.001-05:00

Chartbook

comments...questions? make yourself heard on this blog.

2008-03-03T09:53:00.001-06:00

It's been weeks since the last update. Here is my recently updated fx chartbook.

http://www.qsl.net/n0uax/agtrader/chartbook/fxchartbook.htm

Weekly FX Roundup

2008-02-03T13:48:00.001-06:00

Weekly FX Roundup

Note: Support and Resistance areas noted are general areas of support and resistance and not exact figures.

AUD.USD
50ma- Strong uptrend with 5ma above 10ma. Market is in bullish posture above the 50ma & 100ma.Strategy suggests aggressive buying above the 50ma.
RSI Grid- Market is at 66.23% RSI. Strategy suggests standing aside but close to a sell grid trigger.
50% Fib- Down A-B Wave .9014-.8513, Up 1-2 wave .8513-.9042Short @ .9042 100% extension of A-B wave. Next Sell is .9263 150% extension of A-B.Target is .8783 50% retracement of 1-2 wave.
Notes:Market is trying to take out first overhead resistance at .9014. Follow through buying would confirmthe bullishness and next upside resistance would be the high at .9396. The RSI is on a long term lower trendA break of that trend would also confirm bullishness.

EUR.USD
50ma- Strong uptrend with the 5ma above the 10ma. Market is in bullish poster above the 50ma & 100ma. Strategy suggests aggressive buying above the 50ma.
RSI Grid- Market is at 65.83% RSI. Strategy suggests standing aside but near short grid trigger.
50% Fib- Down A-B Wave 1.3836-1.3357, Up 1-2 Wave 1.3357-1.4965Short @ 1.3833 100%, 1.4067 150%, 1.4541 250% extenstion of A-B. Next sell is 1.5244 400% extension of A-BTarget is 1.4158 50% retracement of 1-2 wave.
Notes: Market keeps trying to test the overhead resistance @ 1.4962. It has been unable to take that area our however.So far the market looks to be consolidating and creating a ascednging triangle which would be bullish. A break of resistance @ 1.4962 would confirm the signal.

USD.CHF
50ma- Strong downtrend with 5ma below the 10ma. Market remains in bearish posture below the 50ma and 100ma.Strategy suggests aggressive selling under the 50ma.
RSI Grid- Market is at RSI 42.01. Strategy suggests standing aside.
50% Fib- Down A-B wave 1.1594-1.728, Up 1-2 wave 1.0891-1.1594.Long @ 1.0894 100% extension of 1-2 Wave. Next buying is 1.0539 150% extension of 1-2 wave. Target is 1.1245 50% retracement of A-B wave.
Notes:Last week market took out nearest support but has lacked follow through selling. Momentum appears to be growing to the bullish side. This could be the beginning of at least a correction higher. There'sno signal yet, however. Market remains in long term downtrend.

GBP.USD
50ma- Weakening downtrend with 5ma above the 10ma. Market is in bearish posture below the 50ma and 100ma.Strategy suggests limited buying below the 50ma.
RSI Grid- Market is at RSI 45.24. Strategy suggests standing aside.
50% Fib- Down A-B wave 1.9947-1.9645, Up 1-2 wave 1.9332-1.9947No Positions. Next buy is 1.933 100% extension of 1-2 wave. Next sell is 1.9947 100% extensionof A-B Wave.
Notes:none

USD.JPY
50ma- Strong downtrend with 5ma below the 10ma. Market is in bearish posture below the 50ma and 100ma.Strategy suggests aggressive selling below the 50ma.
RSI Grid- Market is at RSI 36.79. Strategy suggests standing aside.
50% Fib- Down A-B wave 114.68-104.9, Up 1-2 wave 107.2-114.68Long @ 107.2 100% extension of 1-2 wave. Next buy is 103.48 150% extension of 1-2 wave. Target is 110.97 50% retracement of A-B wave.
Notes:Market is continuing its long term downtrend. The indicators I watch are trending sideways which could signal consolidation.

USD.CAD
50ma- Moderate downtrend with 5ma below the 10ma. Market is in moderate posture below the 50ma and above the 100ma.Strategy suggests moderate selling below the 50ma.
RSI Grid- Market is at RSI 28.28. Strategy suggests standing aside but near a long grid trigger.
50% Fib- Down A-B wave 1.183-.9053, Up 1-2 wave 1.1563-1.183Long at 1.135 150%, 1.1077 300%, 1.059 500%, .9989 750%, .9253 1050% extension of 1-2 wave. Nextbuy is .8460 1400% extension of 1-2 wave.
Notes:Market has taken out its RSI uptrend and momentum has turned lower. Prices have also broken their uptrend.A confirmation of the bearishness would be a breach of nearest support at .981. The question is this a newtrend lower or simply a correction before heading higher?

NZD.USD
50ma- Strong uptrend with 5ma above the 10ma. Market is in bullish posture above the 50ma and 100ma.Strategy suggests aggressive buying above the 50ma.
RSI Grid- Market is at RSI 67.03. Strategy suggests standing aside but near a short grid trigger.
50% Fib- Down A-B wave .8106-.6639, Up 1-2 wave .6639-.7958No Positions. Next buy is ,6639 100% extension of 1-2 wave. Next sell is .8106 100% extension of A-B wave.
Notes:Market has been consolidating since last October between .7958 and .7371. It is on the top of the channel.The indicators I watch suggest a bullish break though of the channel. Watch for confirmation to the upside.

FX Roundup

2008-01-27T21:56:00.001-06:00

Weekly FX Roundup

The support and resistances noted below should be considered general areas of support and resistance and not exact figures.

AUD.USD
Strategies----
50ma: Strong uptrend now with 5ma above the 10ma. Market is now in bullish posture above the 50ma. Strategy suggests aggressive buying above the 50ma.
RSI (14) Grid: RSI is 50.6% suggests standing aside.

50% Fib: Down A-B Wave is .9017 - .8511. Up 1-2 Wave is .8511 - .885.
Last week closed short positions for 340 pip gain. Currently no new trades.

Notes: RSI is trying to define itself a trend here but continues in a steady long term down trend. The market appears to be consolidating and needs to hold above good support at .8551 or risk damage. A rally past .901 is needed to get the bulls going.

EUR.USD
Strategies----
50ma: Strong uptrend with 5ma above the 10ma. Market is in bullish posture above the 50ma. Strategy suggests aggressive buying above 50ma.
RSI (14) Grid: Market @ RSI 52.08% suggests standing.

50% Fib: Down A-B Wave is .1.3833 – 1.3359. Up 1-2 Wave is 1.3359 – 1.4964.
Short @ 1.3833 100%, 1.4067 150%, and 1.4541 250% of Wave A-B. Next sell is 1.5269 400% of Wave A-B. Downside target is 50% of Wave 1-2 @ 1.4162.

Notes: The market appears to be consolidating with a lot of choppiness between 1.4320 and 1.495. The market has created a 1-2-3 top. A break of the #2 point @ 1.4319 would confirm the bearish pattern. That area also is the nearest support. A rally past 1.495 is need to get the bulls going.

USD.CHF
Strategies---
50ma: Strong downtrend with 5ma below the 10ma. Market remains in bearish posture below the 50ma. Strategy suggests aggressive selling below 50ma.
RSI (14) Grid: Market is in neutral territory now at RSI 42.27%. Strategy suggests standing aside.

50% Fib: Down A-B Wave is 1.1595 – 1.0835. Up 1-2 Wave is 1.0892 – 1.1595.
Long @ 1.088 100% correction of Wave 1-2. Next buy is 1.0533 150% correction of Wave 1-2. Upside target is 50% correction of Wave A-B @ 1.1217.

Notes:
none

GBP.USD
Strategies---
50ma: Weak uptrend with 5ma now above the 10ma. Market is in a bearish posture below 50ma. Strategy suggests lmited buying below 50ma.
RSI (14) Grid: RSI is 56.22% which suggests standing aside.

50% Fib: Down A-B Wave is 2.0095 – 1.9338. Up 1-2 Wave is 1.9338 – 1.987.
Last week the upside target was met and a 346 pip profit was taken on long positions.

Notes: RSI has turned higher now after triggering the long grid and has established a new trend up.

USD.JPY
Strategies—
50ma: Strong downtrend with 5ma now below the 10ma. Market is in bearish posture below the 50ma. Strategy suggests aggressive selling below 50ma.
RSI Grid: Market is at RSI 34.43%. Strategy suggests standing aside.

50% Fib: Down A-B Wave is 114.69 – 104.95. Up 1-2 Wave is 107.4 – 114.66.
Long @ 105.74 below the100% correction of Wave 1-2. Next buy is 103.42 the 150% correction of Wave 1-2. Upside target is 50% of Wave A-B @ 109.78.

Notes: none

USD.CAD
Strategies---
50ma: Weakening uptrend with 5ma below the 10ma. Market is in bullish posture above the 50ma. Strategy suggests limited selling above the 50ma.
RSI Grid: Market is at RSI 46.84%. Strategy Suggests standing aside.

50% Fib: Down A-B Wave is 1.183 – .9053. Up 1-2 Wave is 1.1563 – 1.183.
Long @ 1.135 150%, 1.1077 300%, 1.059 500%, .9989 750% and .9253 1050% correction of Wave 1-2. Upside target is 50% correction of Wave A-B @ 1.0432.

Notes: I posted last week that I felt the market may be beginning a consolidation period. That consolidation continues into the new week. The 50 moving average appears to be decent support for the market. RSI has just taken out its 4 month old uptrend.

NZD.USD

Strategies---

50ma: Strong uptrend with 5ma above the 10ma. Market is in bullish posture above the 50ma. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 50.29%. Strategy suggests standing.

50% Fib: Down A-B Wave is .8106 – .6636. Up 1-2 Wave is .6636 – .7931.
Short @ .755 50% correction of Wave A-B. Downside target is 50% correction of Wave 1-2 @ .7372. Next sell is .8847.

Notes: The market continues its consolidation between .7931 and .7372. Until it moves away from this channel and in a meaning full trend, the 50ma strategy will be back and forth buy and sell. The RSI is trending slightly lower.

GOLD

Strategies----

50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Strategy suggests aggressive buying above the 50ma.
RSI Grid: RSI is 67.53%. Strategy suggests standing aside but close to a grid sell.

50% Fib: Down A-B Wave is 676.83 - 641.11. Up 1-2 Wave is 641.11 – 913.94.
Short @ 694.69 150%, 747.65 300%, 819.71 500%, and 909.01 750% correction of Wave A-B. Downside target is 50% correction of Wave 1-2 @ 777.22.

Notes: Call gold the energizer bunny. It keeps going and going and going.

FX Roundup

2008-01-21T18:28:00.001-06:00

Weekly FX Roundup

Please note: I’ve been toying around with yet another strategy. For the lack of a better name I’m calling it the 50% fib. Although the 50% correction/projection is not a Fibonacci number it works on the same principal. It also uses RSI. I’m a HUGE fan of RSI. The strategy is simple. Buy and sell based on the RSI. I use a period of 14. Draw the Fibonacci lines on a chart based on the last legitimate wave. I define those waves as the waves that have completed a 50% correction from the last wave. E-mail me for details. Use the Fibonacci levels to determine how aggressive the trade should be. Determine how many shares or units you are willing to risk at the 100% level. For example, the RSI on the AUD/USD is now below 30% and the market is sitting between the 150% and 300% Fibonacci levels. You’ve determined to risk 1000 units at 100%. Since the market is between the 150% and 300% lines, you would trade 150% of 1000 units which is 1500 units. At this time you would buy 1500 units. Targets or take profits are determined to be the 50% correction of the current wave.

The support and resistances noted below should be considered general areas of support and resistance and not exact figures. Support and resistance areas may range several ticks up or down from what is noted.

AUD.USD
Strategies----
50ma: Strong downtrend now with 5ma below the 10ma. Market is now in bearish posture below the 50ma. Strategy suggests aggressive selling below the 50ma.

RSI (14) Grid: RSI is 36.61% suggests standing aside but very close to buy grid trigger.

50% Fib: Down A, B Wave is .8864 - .7675. Up 1, 2 Wave is .7675 - .9405.
Short @ .8874 100% of Wave A, B. Next sell is .9459 150% of Wave A, B. Downside target is 50% of Wave 1, 2 @ .8534.

Notes: Despite early last week’s bullishness, the market appears weak. RSI has broken its uptrend. Market sits on support @ .8606. Next area of support is .837. It sure looks like momentum is in the bear camp.

EUR.USD
Strategies----
50ma: Strong downtrend with 5ma below the 10ma. Market is in bearish posture below the 50ma. Strategy suggests aggressive selling below 50ma.

RSI (14) Grid: Market @ RSI 34.48% suggests standing aside but very close to buy trigger.

50% Fib: Down A, B Wave is .1.3833 – 1.3359. Up 1, 2 Wave is 1.3359 – 1.4964.
Short @ 1.3833 100%, 1.4067 150%, and 1.4541 250% of Wave A, B. Next sell is 1.5269 400% of Wave A, B. Downside target is 50% of Wave 1, 2 @ 1.4162.

Notes: Exactly like the Aussie Dollar which showed good strength early last week, bears appear to be gaining momentum. The market has created a 1-2-3 top. A break of the #2 point @ 1.4319 would confirm the bearish pattern. That area also is the nearest support. RSI has broken its short term uptrend and is continuing its long term downtrend.

USD.CHF
Strategies---
50ma: Strong downtrend with 5ma now below the 10ma. Market remains in bearish posture below the 50ma. Strategy suggests aggressive selling below 50ma.

RSI (14) Grid: Market is in neutral territory now at RSI 47.99%. Strategy suggests standing aside.

50% Fib: Down A-B Wave is 1.1595 – 1.0835. Up 1-2 Wave is 1.0892 – 1.1595.
Long @ 1.088 100% correction of Wave 1-2. Next buy is 1.0533 150% correction of Wave 1-2. Upside target is 50% correction of Wave A-B @ 1.1217.

Notes:
Last week I posted that the market may try and test the market low and support. It did just that and now appears to be gaining some momentum higher. I would consider this a double bottom. Support @ 1.0896 has to hold to continue the bullishness. The short term lower trend in the RSI has been taken out.

GBP.USD
Strategies---
50ma: Strong downtrend with 5ma below the 10ma. Market is in a bearish posture below 50ma. Strategy suggests aggressive selling below 50ma.

RSI (14) Grid: RSI is 27.75% which has triggered the long grid.

50% Fib: Down A-B Wave is 2.0095 – 1.9405. Up 1-2 Wave is 1.9619 – 2.0095.
Long @ 1.9403 150% of Wave 1-2. Next buy is 1.8673 300% correction of Wave 1-2. Upside target is 50% of Wave A-B @ 1.9749.

Notes: The market is weak. RSI trends have reestablished its trend lower. Market needs to hold this area or risk taking out good support here. Taking out this support would send it much lower.

USD.JPY
Strategies—
50ma: Strong downtrend with 5ma now below the 10ma. Market is in bearish posture below the 50ma. Strategy suggests aggressive selling below 50ma.
RSI Grid: Market is in neutral territory now at RSI 22.65%. Strategy has triggered the long grid

50% Fib: Down A-B Wave is 114.69 – 105.69. Up 1-2 Wave is 107.17 – 114.69.
Long @ 105.74 below the100% correction of Wave 1-2. Next buy is 103.42 the 150% correction of Wave 1-2. Upside target is 50% of Wave A-B @ 110.35.

Notes: Good support is here down to 101.33. A break of this support would be very damaging.

USD.CAD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market is in bullish posture now above the 50ma. Strategy suggests aggressive buying above the 50ma.

RSI Grid: Market is at RSI 74.9%. Strategy has triggered the short grid.

50% Fib: Down A-B Wave is 1.183 – .9053. Up 1-2 Wave is 1.1563 – 1.183.
Long @ 1.135 150%, 1.1077 300%, 1.059 500%, .9989 750% and .9253 1050% correction of Wave 1-2. Upside target is 50% correction of Wave A-B @ 1.0432.

Notes: Last week I posted of a 1-2-3 bottom. The trade during the week confirmed the bullish signal. RSI is trending higher but overbought. ATR appears to be weakening which could signal a narrow channel here. Momentum appears to be dropping off which also suggests either a small correction of narrow trading upcoming.

NZD.USD
Strategies---
50ma: Strong downtrend with 5ma now below the 10ma. Market is in bearish posture below the 50ma. Strategy suggests aggressive selling below the 50ma.

RSI Grid: Market shows no bias now at RSI 30.48%. Strategy suggests standing aside but near a grid buy trigger.

50% Fib: Down A-B Wave is .8106 – .6636. Up 1-2 Wave is .6636 – .7931.
Short @ .755 50% correction of Wave A-B. Downside target is 50% correction of Wave 1-2 @ .7372.

Notes: None

GOLD

Strategies----

50ma: Weakening uptrend with 5ma now below the 10ma. Market remains in bullish posture above the 50ma. Strategy suggests limited selling above the 50ma.

RSI Grid: RSI is 47.91%. Strategy suggests standing aside.

50% Fib: Down A-B Wave is 676.83 - 641.11. Up 1-2 Wave is 641.11 – 913.94.
Short @ 694.69 150%, 747.65 300%, 819.71 500%, and 909.01 750% correction of Wave A-B. Downside target is 50% correction of Wave 1-2 @ 777.22.

Notes: RSI is resting on a long term uptrend but has taken out its short term trend higher. Momentum is really starting to get weak. If I was long, I would take profits off the table and look to reestablish that position. My bias is down in the short term. With the U.S. economy slowing, money flowing away from stocks should help sustain high gold prices.

Spreads In Play

2008-01-13T19:05:00.001-06:00

Buy July 08 Beans Sell November 08 Beans

The USDA gave us a stocks to use ratio of 5.85%. That is a very tight supply situation. I was shocked when these numbers came out that this spread crashed the way it did on Friday. With supply numbers like these, I believe this spread is headed much higher. If the market wants to take it down in a corrective move, I'm willing to keep buying this spread until it rallies. The other thing I like about this spread is that I'm hearing a lot of farmers switching to beans this spring because of high input costs of corn and bean prices. Current supplies being so tight will support old crop futures. With the prospect of more planted acres next spring will put a lid of new crop prices. This spread is headed higher.

Buy July 09 Sell Dec 09

I like the fact that the 08 corn planted acres are projected to be smaller than last year. With high demand, we can't afford to lose acres and/or need to ration our corn. That rationing will come with the 2008 crop.

Short July 08 Corn Long Dec 08 Corn

We are nearing a very tight supply situation which would typically signal bull spreading. With the current rally, I believe we are starting to ration old crop corn supply which will start to bring the stocks to use ratio up. Current supply is enough to meet our needs. I'm also thinking a lot of farmers are switching to beans this season because of high input cost of growing corn. With current prices where they are it is more profitable to grow beans. All of this tells me we need to support new crop corn prices much higher than old crop.

JAN USDA Supply & Demand

2008-01-13T18:54:00.001-06:00

Here's a rundown of the numbers:

CORN
Beg. Stocks: 1304
Production: 13074
Total Supply: 14393
Total Use: 12995
Ending Stocks: 1438
Stock/Use: 11.07% (Tight)

SOYBEANS
Beg. Stocks: 574
Production: 2585
Total Supply: 3165
Total Use: 2990
Ending Stocks: 175
Stock/Use: 5.85% (Very Tight)

WHEAT
Beg. Stocks: 456
Production: 2067
Total Supply: 2613
Total Use: 2321
Ending Stocks: 292
Stock/Use: 12.58% (Very Tight)

FX Roundup

2008-01-13T14:24:00.001-06:00

Weekly FX Roundup

STRATEGIES-------
Please note: The support and resistances noted below should be considered general areas of support and resistance and not exact figures. Support and resistance areas may range several ticks up or down from what is noted.
The noted objectives are usually 50% corrections.

AUD.USD
Strategies----
50ma: Strong uptrend now with 5ma above the 10ma. Market is now in bullish posture above the 50ma. Strategy suggests aggressive buying above the 50ma.

RSI (14) Grid: RSI is 59.77% suggests standing aside.

Support/Resistance: Nearest resistance is .9086 then .9397. Nearest support is .8578 then .8363.

Downside objective is .8363. Upside Objective is .9393.

Notes: Last week the market took out resistance and broke out of its narrow channel going higher. The next resistance area is not significant, but after that it’s the market high which is. RSI is now trending higher giving some momentum to the bulls. The upside objective of the 50% retracement was met last week giving us a new upside objective of .9393 the recent high and 100% fib line.

EUR.USD
Strategies----
50ma: Strong uptrend with 5ma above the 10ma. Market is in bullish posture above the 50ma. Strategy suggests aggressive buying above 50ma.

RSI (14) Grid: Market @ RSI 60.95% suggests standing aside but very close to sell trigger.

Support/Resistance: Nearest support is 1.453 then 1.4292. The closest resistance is then most recent high of 1.496.

Downside objective is 1.4561. Upside objective is market high of 1.4965.

Notes: Last week I posted that overhead resistance is significant as it was the top of the shoulders on a head and shoulder top. The market broke that resistance and appears it will challenge the market high and next resistance area. This nullifies the head and should top. RSI is trending higher.

USD.CHF
Strategies---
50ma: Strong downtrend with 5ma now below the 10ma. Market remains in bearish posture below the 50ma. Strategy suggests aggressive selling below 50ma.

RSI Grid: Market is in neutral territory now at RSI 32.82%. Strategy suggests standing aside.

Support/Resistance: Nearest resistance is 1.1613 then most recent high of 1.1860. Nearest support is 1.088 the most recent low.

Downside objective is 1.0888. Upside objective is 1.1236.

Notes:
RSI is trending lower and briefly triggered the long grid last week. Nearest support is market low which is the last support area. It appears the market is headed to challenge that support.

GBP.USD
Strategies---
50ma: Strong downtrend with 5ma below the 10ma. Market is in a bearish posture below 50ma. Strategy suggests aggressive selling below 50ma.

RSI Grid: RSI is 30.21% suggests standing aside, but very close to long triggers.

Support/Resistance: Nearest resistance is 2.066 then 2.1163. Nearest support is 1.967 then 1.9172.

Downside objective is 1.8908. Upside objective is 2.039.

Notes: Last week the market took out support going lower establishing a new nearest support area of 1.9172. The market also met the 100% fib downside objective giving us a new downside objective of 1.891 which is the 150% fib line.

USD.JPY
Strategies—
50ma: Strong downtrend with 5ma now below the 10ma. Market is in bearish posture below the 50ma. Strategy suggests aggressive selling below 50ma.

RSI Grid: Market is in neutral territory now at RSI 33.26%. Strategy suggests standing aside but very close to long grid trigger.

Support/Resistance: Nearest resistance is113.9 then the 117.9. Nearest support is last market low of 107.26 then 104.11.

Downside objective is 107.21. Upside objective is 111.3

Notes: RSI is on uptrend line and trying to maintain the trend higher. Last week the RSI triggered long grids and came off of it late in the week.

USD.CAD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market is in bullish posture now above the 50ma. Strategy suggests aggressive buying above the 50ma.

RSI Grid: Market shows no bias now at RSI 68.53%. Strategy suggests standing aside but very close to triggering the sell grid.

Support/Resistance: Nearest resistance is 1.034 then most recent high of 1.086. Nearest support is most recent low of .906.

Downside objective is .9653. Upside objective is 1.0463.

Notes: Market has a 1-2-3 low going. A break of the #2 point which is 1.025 would confirm the signal. RSI is trending higher.

NZD.USD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market is in bullish posture above the 50ma. Strategy suggests aggressive buying above the 50ma.

RSI Grid: Market shows no bias now at RSI 60.49. Strategy suggests standing aside but near a grid sell trigger.

Support/Resistance: Nearest resistance is .7884 then market high of .8096. Nearest support is .7465 then .6795.

Downside objective is .7287. Upside objective is .8103.

Notes: The market continues in its narrow sideways channel. Top of the channel is .7865. Bottom of the channel is .7465.

GOLD
Strategies----
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Strategy suggests aggressive buying above the 50ma.

RSI Grid: RSI is 76.8%. Market has triggered the short grid.

Support/Resistance: Nearest resistance is NA. Nearest support is 845.38 then 772.52.

Downside objective is 768.56. Upside objective is 923.21.

Notes: RSI is trending higher.

Weekly FX Roundup

2008-01-06T18:36:00.001-06:00

Notable Chart Patterns:

GBP.JPY: I posted last week of a triple bottom established around 221. Last week saw the market break that support and signal a bearish downtrend.

NZD.USD: Narrow channel. Top of the channel at .788 bottom of the channel at .743. A break of this channel should signal a major trend in the direction of breakout.

STRATEGIES-------
Please note: The support and resistances noted below should be considered general areas of support and resistance and not exact figures. Support and resistance areas may range several ticks up or down from what is noted.
The noted objectives are usually 50% corrections.

AUD.USD
Strategies----
50ma: Weakening downtrend with 5ma now above the 10ma. Market remains in bearish posture below the 50ma. Strategy suggests limited buying under 50ma.

RSI (14) Grid: RSI is 46.55% suggests standing aside.

Support/Resistance: Nearest resistance is .89 then .9397. Nearest support is .8578 then .8363.

Downside objective is .8363. Upside Objective is .8972.

Notes: Market appears to be directionless. RSI shows no trend. Nearest support is not significant. Overhead resistance is significant and could be formidable against any rally attempt above. RSI has established a downtrend adding to a bearish bias.

EUR.USD
Strategies----
50ma: Strong uptrend with 5ma above the 10ma. Market is in bullish posture above the 50ma. Strategy suggests aggressive buying above 50ma.

RSI (14) Grid: Market @ RSI 61.55% suggests standing aside but very close to sell trigger.

Support/Resistance: Nearest support is 1.453 then 1.4292. The closest resistance is 1.4745 then most recent high of 1.496.

Downside objective is 1.4561. Upside objective is market high of 1.4965.

Notes: Overhead resistance is significant as it is the top of the shoulder in the head and shoulder pattern. Taking out that resistance would nullify that pattern. Market is currently on that resistance so this is a pivotal point in the trade. My bias is lower, but let’s see if we can take out the resistance.

USD.CHF
Strategies---
50ma: Strong downtrend with 5ma now below the 10ma. Market remains in bearish posture below the 50ma. Strategy suggests aggressive selling below 50ma.

RSI Grid: Market is in neutral territory now at RSI 29.85%. Strategy has triggered long gridding.

Support/Resistance: Nearest resistance is 1.1613 then most recent high of 1.1860. Nearest support is 1.088 the most recent low.

Downside objective is 1.0888. Upside objective is 1.1236.

Notes:
RSI is trending lower. Nearest support is market low which is the last support area.

GBP.USD
Strategies---
50ma: Strong downtrend with 5ma below the 10ma. Market is in a bearish posture below 50ma. Strategy suggests aggressive selling below 50ma.

RSI Grid: RSI is 31.7% suggests standing aside, but very close to long triggers.

Support/Resistance: Nearest resistance is 2.066 then 2.1163. Nearest support is 1.967 then 1.9172.

Downside objective is 1.8728. Upside objective is 2.039.

Notes: Market is on major support area.

USD.JPY
Strategies—
50ma: Strong downtrend with 5ma now below the 10ma. Market is in bearish posture below the 50ma. Strategy suggests aggressive selling below 50ma.

RSI Grid: Market is in neutral territory now at RSI 24.17%. Strategy has triggered the long gird.

Support/Resistance: Nearest resistance is113.9 then the 117.9. Nearest support is last market low of 107.26 then 104.11.

Downside objective is 107.21. Upside objective is 111.3

Notes:

USD.CAD
Strategies---
50ma: Strong uptrend with 5ma now above the 10ma. Market is in bullish posture now above the 50ma. Strategy suggests aggressive buying above the 50ma.

RSI Grid: Market shows no bias now at RSI 57.12. Strategy suggests standing aside.

Support/Resistance: Nearest resistance is 1.034 then most recent high of 1.086. Nearest support is most recent low of .906.

Downside objective is .9653. Upside objective is 1.0463.

Notes:

NZD.USD
Strategies---
50ma: Strong uptrend with 5ma now above the 10ma. Market is now in bullish posture above the 50ma. Strategy suggests aggressive buying above the 50ma.

RSI Grid: Market shows no bias now at RSI 48.06.

Support/Resistance: Nearest resistance is high of .8103. Nearest support is .7465 then .6795.

Downside objective is .7276. Upside objective is .8103.

Notes:

GOLD
Strategies----
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Strategy suggests aggressive buying above the 50ma.

RSI Grid: RSI is 70.1%. Market has triggered the short grid.

Support/Resistance: Nearest resistance is NA. Nearest support is 845.38 then 772.52.

Downside objective is 824.42. Upside objective is 972.34.

Notes:

Weekly FX Focus

2007-12-30T14:39:00.001-06:00

Weekly FX Roundup

It was a down week for the dollar. The Dollar Index fell 1.5 to 76.235. The index is just shy of the upside target of 78.36. Downside objective is the index low of 74.66. If that support were to break, it would signal a new trend lower.

As I posted last week several dollar pairs were up against support/resistances. All of those pairs listed bounced off those levels signaling a continued weak dollar.

RSI saw long grid trigger in the GBP.USD, GBP.CHF and short grid triggers in the CAD/JPY, EUR/GBP, USD/JPY, gold.

Notable Chart Patterns:

Gold: Last week we posted that the market has been consolidating and forming a symmetrical triangle. A breakout in either direction should signal major trend in the direction of breakout. That breakout occurred to the upside this week. Expect market to take out overhead resistance and continue the rally higher.

CHF.JPY: Last week we posted that the market is in a narrow channel since early November. Channel is 99.5 on top side and 97.5 on the bottom side. A breakout out from this channel should signal a major trend in the direction of the breakout. Last week we saw the breakout higher. Expect the market to continue a rally into overhead resistance.

EUR.AUD: Last week we posted that the market is creating a descending triangle which is bearish. Watch for breakout lower past 1.65. Unfortunately for the bears the market has broken out of the bearish patter higher. If overhead resistance is taken out, the signal would be nullified.

GBP.CHF: Last week we posted the market has created a double top @ 2.336. Watch for confirmation of signal with a break of support lower @ 2.27. This week saw the market confirm the bearish double top. The market is now in a downtrend and should continue lower into support. The 1-2-3 bottom we posted last week has been taken out by the lower trade.

GBP.JPY: Market has a triple bottom established around 220.8.

NZD.USD: Narrow channel. Top of the channel at .788 bottom of the channel at .743. A break of this channel should signal a major trend in the direction of breakout.

STRATEGIES-------
Please note: The support and resistances noted below should be considered general areas of support and resistance and not exact figures. Support and resistance areas may range several ticks up or down from what is noted.
The noted objectives are usually 50% corrections.

AUD.USD
Strategies----
50ma: Weakening downtrend with 5ma now above the 10ma. Market remains in bearish posture below the 50ma. Strategy suggests limited buying under 50ma.
RSI (14) Grid: RSI is 54.19% suggests standing aside.

Support/Resistance: Nearest resistance is .89 then .9397. Nearest support is .8578 then .8363.

Downside objective is .8405. Upside Objective is .899.

Notes: Market appears to be directionless. RSI shows no trend. Nearest support is not significant. Overhead resistance is significant and could be formidable against any rally attempt above.

EUR.USD
Strategies----
50ma: Strong uptrend with 5ma now above the 10ma. Market now is in bullish posture above the 50ma. Strategy suggests buying above 50ma.
RSI (14) Grid: Market @ RSI 64.32% suggests standing aside but very close to sell trigger.
Support/Resistance: Nearest support is 1.453 then 1.4292. Last week’s nearest resistance was taken out. The new closest resistance is 1.4745 then most recent high of 1.496.

Downside objective is 1.415. Last week’s upside objective of 1.464 was met. New upside objective is market high of 1.4965.

Notes: Overhead resistance is significant as it is the top of the shoulder in the head and shoulder pattern. Taking out that resistance would nullify that pattern. Market is currently on that resistance so this is a pivotal point in the trade. My bias is lower, but let’s see if we can take out the resistance. RSI downtrend was taken out last week adding to the bullish rally. The market had a small downtrend going but was also taken out going higher this week.

USD.CHF
Strategies---
50ma: Strong downtrend with 5ma now below the 10ma. Market remains in bearish posture below the 50ma. Strategy suggests aggressive selling below 50ma.
RSI Grid: Market is in neutral territory now at RSI 35.66%. Strategy suggests standing aside but very close to long trigger.

Support/Resistance: Nearest resistance is 1.1613 then most recent high of 1.1860. Nearest support is 1.088 the most recent low.
Downside objective is 1.1236. Upside objective is 1.1680.

Notes: Last week market rallied up to resistance and then reversed like so many dollar pairs. RSI uptrend was taken out last week. The area of resistance also happened to be the downtrend line. The overall downtrend continues.

GBP.USD
Strategies---
50ma: Strong downtrend with 5ma below the 10ma. Market is in a bearish posture below 50ma. Strategy suggests aggressive selling below 50ma.
RSI Grid: RSI is 39.3% suggests standing aside, but very close to long triggers.
Support/Resistance: Nearest resistance is 2.0249 then 2.0547. Nearest support is 1.967 then 1.9172.

Downside objective is 1.9172. Upside objective is 2.011.

Notes: Last week’s nearest resistance was taken out. The next two resistance areas are formidable against any rally. On the other hand the market hit solid resistance of 1.967 and reversed higher. Support is formidable as well. A breakout in either direction past either support or resistance would signal a pretty major trend. RSI is trending lower but looks like it wants to take out the downtrend line. My bias is bullish to the nearest resistance. The overall downtrend continues.

USD.JPY
Strategies—
50ma: Strong uptrend with 5ma above 10ma. Market is in bullish posture above 50ma. Strategy suggests aggressive buying above 50ma.
RSI Grid: Market is in neutral territory now at RSI 47.3%. Strategy suggests standing aside.

Support/Resistance: Nearest resistance is113.9 then the most recent high of 115.98. Nearest support is last market low of 107.26.

Downside objective is 110.57. Upside objective is 115.4.

Notes: Market rallied into resistance and went lower. That area happens to be right on the downtrend line. It looks like the market is having a tough time taking out that area going higher. RSI has broken uptrend.

USD.CAD
Strategies---
50ma: Strong downtrend with 5ma below the 10ma. Market is in bearish posture now below the 50ma. Strategy suggests aggressive selling below the 50ma.
RSI Grid: Market shows no bias now at RSI 33.65. Strategy suggests standing aside but very close to long trigger.

Support/Resistance: Nearest resistance is 1.034 then most recent high of 1.086. Nearest support is most recent low of .911.

Downside objective is .9653. Upside objective is 1.0463.

Notes: This is another one of those dollar pairs that went to resistance and the established downtrend then reversed. So the overall downtrend continues.

NZD.USD
Strategies---
50ma: Strong uptrend with 5ma now above the 10ma. Market is now in bullish posture above the 50ma. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 59.08.

Support/Resistance: Nearest resistance is most recent high of .7877 then .8103. Nearest support is .7426 then .6795.

Downside objective is .7276. Upside objective is .7871.

Notes: This market is one of the few examples that the 50ma strategy doesn’t work 100% of the time. The market has been in somewhat of a channel since October. It’s very difficult for the 50ma strategy to profit from a market in a narrow channel. The strategy really shines with long trends. Until we get that breakout and long trend, expect the 50ma to aggressively sell one week and switch to an aggressive buy the next.

GOLD
Strategies----

50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Strategy suggests aggressive buying above the 50ma.
RSI Grid: RSI is 70.3%. Market has triggered the short grid.

Support/Resistance: Nearest resistance is 845.38 the most recent high.. Nearest support is 772.5.

Downside objective is 742.75. Upside objective is 845.38.

Notes: With a breakout of the triangle to the upside watch for a continued rally. A break of support and a new high would really put a lot of momentum with the bulls.

Weekly FX Roundup

2007-12-23T17:52:00.001-06:00

Weekly FX Roundup

Yet another strong week for the Dollar as the index closed up .3 from last week. If you follow the 50ma strategy with the weekly chart, the 5ma has now trended above the 10ma. This indicates a weakening downtrend. The question now is this a correction or the beginning of a new uptrend? Expect continued rally into resistance 78.425 and then 82.03. Looking at some of the individual dollar pairs I see the next few weeks being somewhat important for the dollar bulls. The EUR, CHF, GBP, JPY, CAD, and the AUD are all up against resistance for the dollar rally. If we see these resistances taken out by the dollar rally, the tides of change and a strong rally just might be underway.

Next week will be fairly limited because of Christmas and New Years.

RSI saw long grid trigger in the GBP.USD and short grid triggers in the USD/CHF.

Notable Chart Patterns:
Gold: Market consolidation forming a symmetrical triangle. Breakout in either direction should signal major trend in direction of breakout. 1-2-3 top is intact watch for confirmation of signal which would be lower.
CHF.JPY: Market is in a narrow channel since early November. Channel is 99.5 on top side and 97.5 on the bottom side. A breakout out from this channel should signal a major trend in the direction of the breakout.
EUR.AUD: Market is creating a descending triangle which is bearish. Watch for breakout lower past 1.65.
GBP.CHF: Market has created a double top @ 2.336. Watch for confirmation of signal with a break of support lower @ 2.27. A conflicting signal yet still valid is a possible 1-2-3 bottom. A confirmation of this bullish signal would be a rally past the #2 point which is 2.34.
GBP.JPY: Market has a triple bottom established around 220.8.

STRATEGIES-------
Please note: The support and resistances noted below should be considered general areas of support and resistance and not exact figures. Support and resistance areas may range several ticks up or down from what is noted.
The noted objectives are usually 50% corrections.

AUD.USD
Strategies----
50ma: Strong downtrend with 5ma below 10ma. Market remains in bearish posture below the 50ma. Strategy suggests aggressive selling under 50ma.
RSI (14) Grid: RSI is 44.96% suggests standing aside.
Support/Resistance: Nearest resistance is .89 then .9397. Nearest support is .8578 then .8363.
Downside objective is .8363. Upside Objective is .899.

EUR.USD
Strategies----
50ma: Strong downtrend with 5ma below the 10ma. Market remains in bearish posture below the 50ma. Strategy suggests aggressive selling below 50ma.
RSI (14) Grid: Market @ RSI 36.33 suggests standing aside but very close to long trigger.
Support/Resistance: Nearest support is 1.4292 then 1.3847. Nearest resistance is 1.453 then most recent high of 1.496.
Downside objective is 1.415. Upside objective is 1.464.

USD.CHF
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Strategy suggests aggressive buying above 50ma.
RSI Grid: Market is in neutral territory now at RSI 67.97. Strategy suggests standing aside but very close to short trigger.
Support/Resistance: Nearest resistance is 1.1613 then most recent high of 1.1860. Nearest support is 1.088 the most recent low.
Downside objective is 1.1236. Upside objective is 1.1680.

GBP.USD
Strategies---
50ma: Strong downtrend with 5ma below the 10ma. Market is in a bearish posture below 50ma. Strategy suggests aggressive selling below 50ma.
RSI Grid: RSI is 27.25 and oversold and has triggered the long grid.
Support/Resistance: Nearest resistance is 1.9921 then 2.0214. Nearest support is 1.967 then 1.9411.
Downside objective is 1.9202. Upside objective is 2.011.

USD.JPY
Strategies—
50ma: Strong uptrend with 5ma above 10ma. Market is in bullish posture above 50ma. Strategy suggests aggressive buying above 50ma.
RSI Grid: Market is in neutral territory now at RSI 69.18. Strategy suggests standing aside but very close to short trigger.
Support/Resistance: Nearest resistance is 113.98 then the most recent high of 115.98. Nearest support is last market low of 107.21.
Downside objective is 110.57. Upside objective is 115.4.

USD.CAD
Strategies---
50ma: Weakening uptrend with 5ma now below the 10ma. Market remains in bullish posture above the 50ma. Strategy suggests limited selling above the 50ma.
RSI Grid: Market shows no bias now at RSI 41.46. Strategy suggests standing aside.
Support/Resistance: Nearest resistance is 1.034 then most recent high of 1.086. Nearest support is most recent low of .911.
Downside objective is .9653. Upside objective is 1.0463.

NZD.USD
Strategies---
50ma: Strong downtrend with 5ma now below the 10ma. Market is now in bearish posture below the 50ma. Strategy suggests aggressive selling below the 50ma.
RSI Grid: Market shows no bias now at RSI 47.8. Stand aside.
Support/Resistance: Nearest resistance is most recent high of .7877 then .8103. Nearest support is .7426 then .6795.
Downside objective is .7276. Upside objective is .7731.

GOLD
Strategies----
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 55.56. Strategy suggests standing aside.
Support/Resistance: Nearest resistance is 836.6. Nearest support is 772.5.
Downside objective is 742.75. Upside objective is 845.38.

Corn-Bean Basis

2007-12-17T13:06:00.001-06:00

Just a few fundamental thoughts here. With the latest USDA supply and demand numbers coming out last week, I think fundamentals have painted a pretty bullish picture for beans. Stocks to use ratio is now at 6.2% which is a very tight supply. If you plug the numbers in the Grandmill formula you come up with a fair value range of 1501 to 1068 for old crop! Is this the year beans will be in the teens? I think it might be. Looking at the basis chart below you can see an improving basis. Why is this significant? It is very rare to see a large basis improvement along with a large futures rally. If end users are willing to bid up the cash against futures in the face of the present rally, there is only one direction this market can go. Straight up! As a hedger I'm looking at protecting the upside either with calls or buying futures. I know call option prices are through the roof, but it may pay dividends in the end.

The same is true for corn, but not nearly as bullish as beans. We are seeing a pretty big rally in futures along with basis improvement. As long as we see this trend continue, bull spreading the market is a pretty good idea (long old crop short new crop). Stocks/Use ratio at 14.6% suggests an adequate supply. Because of the supply issue, I believe the current trend (basis improvement & futures rally) is limited and should give way to a pretty big reversal. That will either be a basis crash or futures decline. If basis starts to weaken, it will be more profitable to sell cash rather than futures. If basis remains firm, it will be more profitable to sell futures than cash.

To sum it up, I like the bullish positions in these grains. Hedging this I would either lock in floors with puts and keep the cash. Or I would buy call options in hope that the market rallies to the strike of the call and sell cash. Either way I would certainly position to keep the top side open.

Weekend FX Roundup

2007-12-15T13:31:00.001-06:00

Weekly FX Roundup

This week was another fairly decent week for the Dollar. The Dollar index weekly settled at 76.34 up .17 from last week. The index is still in a pretty aggressive downtrend with no real good signal to justify longs yet. Just a correction to the 50% retracement mark would give us a figure of 83.57 which happens to be the market’s first significant resistance. That’s a pretty big “rally” if that occurs.

RSI saw long grid trigger in the AUD/NZD and short grid triggers in the USD/CAD. Both of those markets have come off their triggers.

Notable Chart Patterns:
Gold: Market consolidation forming a symmetrical triangle. Breakout in either direction should signal major trend in direction of breakout. 1-2-3 top is intact watch for confirmation of signal which would be lower.
CHF.JPY: Market is in a narrow channel since early November. Channel is 99.5 on top side and 97.5 on the bottom side. A breakout out from this channel should signal a major trend in the direction of the breakout.
AUD.USD: Market has broken lower past good support at 87ish. This should signal a new trend lower.
EUR.AUD: Market is creating a descending triangle which is bearish. Watch for breakout lower past 1.65.
EUR.USD: Market has broken lower past good support at 1.45. This should signal a new trend lower.
GBP.CHF: Market has created a 1-2-3 bottom. A confirmation of this bullish signal would be a rally past the #2 point which is 2.34.
GBP.USD: Loose head and shoulder top. Market has broken support. 1-2-3 top and head and shoulder top have been confirmed. Look for bearish trend to continue.
NZD.USD: Market has created a double top. Confirmation of the signal would be for a decline past .75.

STRATEGIES-------
AUD.USD
Strategies----
50ma: Strong downtrend with 5ma below 10ma. Market remains in bearish posture below the 50ma. Nearest resistance is .89. Nearest support is 50% retracement @ .85. Strategy suggests aggressive selling under 50ma.
RSI (14) Grid: RSI is 40.2 suggest standing aside.

EUR.USD
Strategies----
50ma: Strong downtrend with 5ma moving below the 10ma. Market is now in bearish posture below the 50ma. Nearest support is 50% retracement @ 1.42. Nearest resistance is most recent high of 1.496. Strategy suggests aggressive selling below 50ma.
RSI (14) Grid: Market @ RSI 38.5 suggests standing aside.

USD.CHF
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market is now in bullish posture above the 50ma. Nearest resistance is most recent high at 1.189. Nearest support is 1.12. Strategy suggests aggressive buying above 50ma.
RSI Grid: Market is in neutral territory now at RSI 65.4. Strategy suggests standing aside.

GBP.USD
Strategies---
50ma: Strong downtrend with 5ma below the 10ma. Market is in a bearish posture below 50ma. Nearest resistance is 2.057 the most recent high. Nearest support is 2.015. Strategy suggests aggressive selling below 50ma.
RSI Grid: Market shows no bias now at RSI 38.11. Strategy suggests standing aside.

USD.JPY
Strategies—
50ma: Strong uptrend with 5ma above 10ma. Market is now in bullish posture above 50ma. Nearest resistance is 115.91 the most recent high. Nearest support is last market low of 107.21. Strategy suggests aggressive buying above 50ma.
RSI Grid: Market is in neutral territory now at RSI 60. Strategy suggests standing aside.

USD.CAD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is 1.086 the most recent high. Nearest support is now 50% correction at .966. Strategy suggests aggressive buying above the 50ma. RSI Grid: Market shows no bias now at RSI 63. Strategy suggests standing aside.

NZD.USD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is .79. Nearest support is .7445. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 48.5.

GOLD
Strategies: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is 836.6. Nearest support is 779.7. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 49.0. Strategy suggests standing aside.

USDA DEC S&D Report

2007-12-11T07:53:00.001-06:00

Good Morning

The USDA Grain Supply and Demand Report is out today a little friendly for everything as usage is up sending ending stocks lower. If you're following spreads, the bull spreads (long old crop short new crop) ought to be in good shape for awhile. Here are the numbers:

All Wheat
Beg Stocks: 456
Production: 2067
Total Supply: 2613
Total Use: 2333 - raised from 2301 from last month
Ending Stocks: 280 - lowered from 312 last month
Stocks/Use: 12% (Very Tight)

Corn
Beg Stocks: 1304
Production: 13168
Total Supply: 14487
Total Use: 12690 - raised from 12590 last month
Ending Stocks: 1797 - lowered from 1897 last month
Stocks/Use: 14.16% normal supply

Beans
Beg Stocks: 573
Production: 2594
Total Supply: 3173
Total Use: 2988 - raised from 2963 last month
Ending Stocks: 185 - lowered from 210 last month
Stocks/Use 6.19% (very tight)

Corn Spread to Watch

2007-12-10T16:10:00.001-06:00

Here's a corn spread I think is a pretty good bet. Long Dec '08 (cz8) Short Jul '08 (cn8). Here's how I see it. Stocks to use ratio is at 15% which historically suggests an adequate supply. We have enough supply to meet demand into the next crop year. This will pressure any major rally in old crop contracts. On the other side of the trade, many farmers around the country are looking at increasing their bean plantings which will take acres away from corn. New crop contracts will have to compete for acres versus beans and wheat. This should help support new crop (cz8) corn. Target for this spread is 15-20 cents. Today, I started the buying at 5, and will look to add to positions every 10 cents lower. Full carry is around 21 cents for this spread! Adequate to large supplies should send this spread back to full carry.

Please note the Dec. crop report comes out tomorrow. A stocks to use ratio higher than 15% could start the charge higher in this spread whiled a S/U lower than 15% could give us an opportunity to add to positions.

Stay Tuned.....

Weekly FX Roundup

2007-12-08T18:28:00.001-06:00

Weekly FX Roundup

This week saw a steady to better trade in most of the major USD pairs. This week saw the pound move lower against the Dollar triggering aggressive selling in the 50ma strategy. This is a complete flip flop from the week before which was aggressively buying. Watch for a possible breakout lower in the GBP/USD pair. We are right near support and below the 50% correction. It could pick up steam with support being taken out.

RSI saw long grid trigger in the AUD/NZD and brief short grid triggers in the EUR/CAD and USD/CAD.

Notable Chart Patterns:
Gold: Market consolidation forming a symmetrical triangle. Breakout in either direction should signal major trend in direction of breakout. 1-2-3 top is intact watch for confirmation of signal which would be lower.
GBP/USD: Loose head and shoulder top. Market sitting on support. Watch for break lower. 1-2-3 top is confirmed with prices breaking lower past the #2 point.
USD/CAD: Market has rallied past 50% correction. Look for the uptrend to continue with minor setbacks.
AUD/NZD: Market has declined past the 50% correction. Look for the downtrend to continue with minor rally corrections.

AUD.USD
Strategies----50ma: Strong downtrend with 5ma below 10ma. Market is in bearish posture below the 50ma. Nearest resistance is market high of .937. Nearest support is 50% retracement @ .85. Strategy suggests aggressive selling under 50ma.
RSI (14) Grid: RSI is 45.17 suggest standing aside.

EUR.USD
Strategies----50ma: Weakening uptrend with 5ma moving below the 10ma. Market remains in bullish posture above the 50ma. Nearest support is 50% retracement @ 1.42. Nearest resistance is market high of 1.492. Strategy suggests limited selling above 50ma.
RSI (14) Grid: Market @ RSI 51.46 suggests standing aside.

USD.CHF
Strategies---50ma: Weakening downtrend with 5ma above the 10ma. Market remains is a bearish posture below 50ma. Nearest resistance is 50% correction at 1.141. Nearest support is 1.089. Strategy suggests limited buying below 50ma.
RSI Grid: Market is in neutral territory now at RSI 51.089. Strategy suggests standing aside.

GBP.USD
Strategies---50ma: Strong downtrend with 5ma below the 10ma. Market is in a bearish posture below 50ma. Nearest resistance is 2.083 the most recent high. Nearest support is 2.026. Strategy suggests aggressive selling above 50ma.
RSI Grid: Market shows no bias now at RSI 39.36. Strategy suggests standing aside.

USD.JPY
Strategies—50ma: Weakening downtrend with 5ma moving above 10ma. Market remains in bearish posture below 50ma. Nearest resistance is 112.75 the 50% correction. Nearest support is last market low of 107.21. Strategy suggests limited buying below 50ma.
RSI Grid: Market is in neutral territory now at RSI 49.78. Strategy suggests standing aside.

USD.CAD
Strategies---50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is 1.085 the most recent high. Nearest support is recent low of .9056. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 60.29. Strategy suggests standing aside.

NZD.USD
Strategies---50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is .79. Nearest support is .7445. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 57.9.

GOLD
Strategies: Weakening uptrend with 5ma below the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is 836.6. Nearest support is 836.5. Strategy suggests limited selling above the 50ma.
RSI Grid: Market shows no bias now at RSI 49.7%. Strategy suggests standing aside.

Corn Spread

2007-12-01T19:02:00.001-06:00

Here's the easiest money you'll ever make. Go long cn09 go short cz08. History of this spread shows that a -10 or better entry will yield 15-20 cents.

FX Weekly Roundup

2007-12-01T15:19:00.001-06:00

Weekly FX Summary

This week saw a reasonable rebound in most of the major dollar pairs including gold. It remains to be seen whether this is an honest return to a strong dollar rally or just a correction. The dollar’s decline has been fast and furious. If most of these pairs want to simply correct back to the 50% retracements (50% retracements are my main target for corrections), it would be a very large move. The Fed looks to cut interest rates which will pressure the dollar short term.

Most notable chart patterns are in the Pound and Gold both pounding out a 1-2-3 top. Watch these markets for confirmations (a breach of the number 2 point).

Also to note the below pairs are about ½ the currency pairs I trade. After this week, I currently have no pairs that have triggered the RSI grid in either direction. I think that is a first.

I’ll try and get these updates posted every Saturday.

Interested in Forex investing but don’t know were to go? I’m tossing around starting a “FX pool” starting at the first of the year. E-mail me with your questions or comments – jmk@jamesology.com

AUD.USD
Strategies----
50ma: Weakening downtrend with 5ma and 10ma the same. Market is in bearish posture below the 50ma. Nearest resistance is 50ma at .8956. Strategy suggests aggressive selling under 50ma.
RSI (14) Grid: RSI is 47.33 suggest standing aside.

EUR.USD
Strategies----
50ma: Weakening uptrend with 5ma moving below the 10ma. Market remains in bullish rally above the 50ma. Nearest support is 1.45. 50ma is 1.4421. Strategy suggests limited selling above 50ma.
RSI (14) Grid: Coming off of oversold and now below the 70% grid sell trigger. Strategy suggest standing aside.

USD.CHF
Strategies---
50ma: Weakening downtrend with 5ma moving above the 10ma. Market remains is a bearish posture below 50ma. Nearest resistance is 50ma at 1.15 which is also 50% retracement. Strategy suggests limited buying below 50ma then aggressive buying above the 50ma.
RSI Grid: Market is coming off of oversold territory now at RSI 52.15. Strategy suggest standing aside.

GBP.USD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in a bullish posture above 50ma. Nearest resistance is 2.116 the recent high. Strategy suggests aggressive buying above 50ma.
RSI Grid: Market shows no bias now at RSI 48. Strategy suggests standing aside.

USD.JPY
Strategies—
50ma: Weakening downtrend with 5ma moving above 10ma. Market remains in bearish posture below 50ma. Nearest resistance is 112.82. Strategy suggests limited buying below 50ma then aggressive buying above 50ma.
RSI Grid: Market is coming off of oversold territory now at RSI 49.78. Strategy suggests standing aside.

USD.CAD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is 1 where the market is currently. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 60. Strategy suggests standing aside.

NZD.USD
Strategies---
50ma: Strong uptrend with 5ma above the 10ma. Market remains in bullish posture above the 50ma. Nearest resistance is .79. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 51.

GOLD
Strategies: Weakening uptrend with 5ma and 10ma the same value. Market remains in bullish posture above the 50ma. Nearest resistance is 836.6. Strategy suggests aggressive buying above the 50ma.
RSI Grid: Market shows no bias now at RSI 45%. Strategy suggests standing aside.

Random Morning Thoughts

2007-08-22T07:55:00.001-05:00

Grains overnight were higher. Corn up 2 Beans up 7 CBT wheat up 6.

Corn has setup a spring high fall low situation, but many suggest with tight stocks and high demand will push is higher from here. The level to watch is the 360 area. If we rally past that, I think that idea could be the right one. I'm not entirely convinced yet. The tours coming out have found smaller yields in the fields giving the market fuel to rally. We'll see how far they push it.

Wheat continues it's uptrend after a correction lower. Dec needs to see a close above 715 to continue the trend. If that fails, we have a double top and it looks weak. I don't believe we'll fall too far, but I wouldn't be long if she fails above 715. The K index paints a weak rally.

Beans have a really nice looking head and shoulder pattern with a gap that needs to be filled starting at 852. Basis is crappy suggesting ample supply for now. If we fill that gap and head lower, sell for the short term and don't get greedy. Fundamentals have a spring low high fall situtation. I'm a willing scale buyer at this point.

FX
The greenback is lower this morning except in the CHF. I'm short gridding all the majors except CAD, and CHF. MAs are trying to turn back higher in the JPY, AUD, GBP, and EUR. If that happens, we're back on the long grid side. If interest rates are going to be cut, the dollar will continue to fall.

Corn: Long or Short?

2007-08-21T09:57:00.001-05:00

Dec 2007 corn has given us a little bit of a bounce here. Looking at the charts and pure technicals gives us a possible 1-2-3 bottom. A break and close above he number 2 point and resistance at 360 would signal a new uptrend, while a break and close below the number 1 point would signal continued weakness and downtrend.

Random Morning Comments

2007-08-10T07:58:00.001-05:00

Guten Morgan

FX
Finacial markets around the world were sharply lower last night including Dow futures. It looks to be another red day on Wall Street. That puts pressure on all the Yen carries in the Forex this morning. The grid has been massively buying mostly Yen pairs through the night with limited TPs. The hedge end of things nearly every position is in the black.

Looking at the charts technically a lot of these currencies appear to be changing trends. Most long term trends have been taken out now. It remains to be seen whether or not these new trends are just corrective or the start of a new major trend in the other direction. If it's a new trend, that will put the grid in a defensive posture.

This weekend I'll try and put together a chart book of all the majors.

Commodities
Report day. I haven't seen all of the details yet, but my first thoughts were bearish corn bullish beans and wheat. Traders reflect that idea and are calling corn down 2-3 beans up 3-5 and wheat up 2-3. I'll also post those numbers this weekend and give a run down of the fundamentals. My current positioning is long beans, neutral - bearish wheat, and short gridding corn.

I think this wheat is overbought and just waiting for a signal to sell. I've been scale selling wheat every 30 cents higher and have 4 minis sold with a futures and a short call. If she looks to be going lower at that point I will add a put. We'll see how she goes.

Beans I'm all long with 2 minis so far and a butterfly call spread. The higher the better. The other account I'm moving up sell stops with the market. I don't want to loose the gains out of the butterfly.

My corn positions are are gridding short at 340 and looking for more at 360. I almost got 360 yesterday but she failed to trade.

Forex Focus - AUD/JPY

2007-08-09T14:55:00.001-05:00

For the midweek FX focus let’s look at the AUD/JPY currency pair.

Technically:

Prices have really dropped as investors take money out of the carries. With the latest Dow move higher (yesterday) though we did see some buying the last few days. Support and resistance areas look like this. Nearest resistance is the more recent high of 108. A break above that level would signal a new uptrend higher. Nearest support is in the 98 area which is also the 50% retracement of the latest move higher. A break in that level and the next support is 93 after that 89. RSI has been trending lower but currently trying to rebound to mid levels. MAs shows a bearish trend. My bias is bearish as investors are jittery over housing mortgage rates and delinquent loans. I think the Dow could suffer here for awhile which would prompt traders to take money out of the carries (long yen).

-
The Grid:

Looking at the daily chart for the AUD/JPY and grid position, you can see the grid has collected quite a number of dangles (blue triangles) as the market goes lower. Notice the extreme volatility the market has been under since July 27th. Volatility is the grid’s best friend. This chart shows us the reason it is important to keep grid unit sizes small. Also, even though we are collecting a large amount of units here that draws the account balance down, we are still collecting interest.

The next chart is the AUD/JPY hourly. You can see how well the grid does in a volatile market. Every blue triangle is a trade entry. Every green dot is a TP on those trades. The more she bounces the more the grid makes.

The Carry:

The next chart is the Carry trade. You can see that a carry was entered on July 16th and the market promptly went lower. No big deal interest is being earned, and hopefully we’ll get another opportunity to enter at a better price which brings down the total average. As you can see that opportunity hit on Aug 7th. If the market starts to rally here we’re going to want to lock profits in on the Aug carry trade and then the July carry trade. If the market goes down not allowing us to TP those trades, we’ll simply enter again which will bring down the total average more.

The Hedge:

Next we’ll look at the hedge. A lot of hedge profits were taken out of the market on Aug 7th. However, we weren’t able to TP some of the dangles (yellow triangles). I’ll simply let those positions be incase the market goes lower again. I’m also going to reload the hedge around 99.5

Happy Trading

Random Morning Thoughts

2007-08-09T07:15:00.001-05:00

I got an e-mail from my hedge broker about corn. He sent a chart that showed the cash market taking out its downtrend. It appears that basis is strengthening as well. It looks like fundamentally corn may have found some really good support.

Here we go again. The French have frozen 3 asset backed securities struggling to find liquidity in the US price mortgage market. Down went a lot of jpy pairs…. big time. And the grid is still buying. The markets also retriggered a few hedges. I don’t know this market being so volatile right now, I might have to back my stops and entries back so they don’t get caught up in all the volatility. Despite all the jpy woes, the dollar is strengthening against the Euro and Cad and gold. The grid is taking pretty good profits off the table there.

Random Morning Thoughts

2007-08-08T06:42:00.001-05:00

The FX grid went nuts last night. Most major indices around the globe were up pretty big. There was lots of selling yen and dollar. I also got stopped out on a few hedges for pretty good gain. And the USD/JPY carry was triggered last night.

Dec wheat was up 1 ¾ Dec Corn up 1 ¼ and beanie babies were up 4 ¼. Saw some commentary yesterday were they said grains were likely to move higher as the seasonal tendency for grains is to rally until Sept.

The corn grid has one short position at 340 and hoping for more at 360.

I really like the ’08 bull spreads in corn and beans. I think the July-Nov bean spread could be through the roof between now and spring. The corn july-dec bull spread is a HUGE bargain if they start cutting ending stocks. Stocks/Use is tight and there’s no reason that that spread is at full carry like it is now.

Forex Focus - USD/JPY

2007-08-05T17:22:00.001-05:00

To start the trade week let’s have a look at the USD/JPY pair and how the grid is set up. First, looking at the day chart you can see how many positions have been traded (blue triangles) that couldn’t be TPd (green lines). This shows how important it is to keep grid units small incase of draw down. Even though this particular pair has many positions, it is collecting interest. Eventually, this pair will find a bottom and will bounce between that high and low. Extreme highs and lows are pretty rare. Once the grid has traded completely through an extreme high and an extreme low, that's really when net asset value soars.

From a technical standpoint, the USD/JPY pair is on support. If support is broken, further liquidation is possible to next support of 116 and then 115.

The next chart is the USD/JPY hourly. It shows you an up close look at how the grid has done since AUG 1. You can see even though the market is trending lower, the grid is still able to pick up gains (green circles) as the market bounces around on an intraday basis.

Next we have the carry. At this time there are no carry trades. The current limit buy order is 119.7 around the 18 day MA. If the market rallies that far, the carry would be triggered.

Finally, we have the hedge. The hedge has done very well with the latest market downturn. The first hedge was actually triggered at 123 and stopped out with a profit of 100 ticks. At that same time I reloaded a hedge trade at 121 which is the current initial hedge. You can see by the red line I have locked in over a 100 tick profit. You will also notice two entries from way back in April. Those are actually trades I had on from a previous strategy that I left for hedge purposes. They are starting to accumulate money. The yellow squares underneath the market are my dangle orders to sell if the market falls that low. The lower the market goes, the lower I will place my stops to lock in profits.

That is all from this chair today.

For more information about this Forex strategy please surf here: http://s207738570.onlinehome.us/agtrader/fx/fx.htm

USDA July Supply & Demand

2007-07-12T13:12:00.001-05:00

USDA Supply/Demand

Corn
US Supply
Beginning Stocks: 1137
Production: 12840
Total Supply: 13992
Total Use: 12490
Ending Stocks: 1502
Stocks/Use: 12%

From last month the USDA increased production, total supply, beginning stocks and ending stocks. The production increases are inline with crop conditions that are seeing better conditions than last year. We currently are sitting at 150 bu/acre trend line. Total use was increased only 15 million bushels. Ending stocks were increased over 500 million bushels or 66%. Stocks to use ratios went from a very tight supply to only marginally tight. The Grandmill formula puts the fair high around 450 futures.

Watch those basis levels around the country. If we remain firm, demand should sustain us here. At this point I’d be a seller of rallies. If basis starts to crumble as it did around the 400 plus mark, bulls will be stampeding for the doors to jump ship.

Beans
US Supply
Beginning Stocks: 600
Production: 2625
Total Supply: 3229
Total Use: 2985
Ending Stocks: 245
Stocks/Use: 8.21%

From last month the USDA decreased beginning stocks, production, total supply, and ending stocks. Ending stocks saw the biggest % cut. Stocks/use ratio went from 10.53% tight to an 8.21% very tight.

I got to say I’m really seeing a mixed bag here. I’m having difficulty with the very tight numbers coming out of the USDA with such a wide basis. Basis is really a mess around the country and it doesn’t look to improve. I think the huge crop we saw the past two years has given us enough beans going into next year. I’ve done a lot of no basis established selling of cash crop. If the USDA’s numbers are correct, I can’t imagine how or why the current basis could get any worse or stay where it’s at. With 8.2% stocks to use, which is very tight supply, that basis has got to get SIGNIFACANTLY better. If the basis fails to get better here, I’m selling futures or bear spreading July-Nov 2008 crop.

Commodity Technical Roundup

2007-06-24T20:02:00.001-05:00

Here's how it looks from this chair today.

DEC CORN
Trend is up. MAs shows no bias but is weakening. Nearest Support is 379 then 356. Nearest Resistance is 430 (double top). RSI trending down at 43%.

Comments: At the moment the double top has held. 2 minor uptrends have now been taken out. The only trend left is the major uptrend line extending from the Sep. 2006 low. The only question to me is if this is a minor correction then continued rally or is it the season slide lower? Fundamentals have set up a spring high and fall low scenario. A close under the uptrend line (currently @ 372) and under major resistance at 356 would do serious technical damage.

DEC CBT WHEAT
Trend is up. MAs show no bias but is weakening. Nearest support is 563 the 50% retracement from the latest move then 493. RSI has peaked and is declining at 71.62.

Comments: Friday gave us an unconfirmed evening star. A close under 609.5 would setup for some weakness. We’re in dire need for a correction lower.

NOV BEANS
Trend is up. MAs shows no bias but very close to a sell signal. Nearest support is 753. RSI is declining at 40.21

Comments: Market has confirmed an evening star created last week. That sets up lower prices for awhile. A break in trend and support would do serious damage to the market.

OCT Live Cattle
Trend is down. MAs shows no bias but is weakening. Nearest support is 92.8. Nearest resistance is 95. RSI is starting to become weak now at 51.95.

Comments: It looks like the market has been in a minor correction phase and now wants to pull back more. If MAs triggers a sell, it would be a strong sell. If support doesn’t hold, the next support area is 90ish.

OCT HOGS
Market is in a channel. MAs shows a weak sell. Nearest support is 64.8 then 61.8. Nearest resistance is 69.4. RSI is declining now at 31.13.

Comments: The market has been range bound between 69.5 and 65 for sometime. It is now very close to support. A break in support would yield a new downtrend. MAs triggered a sell after Friday’s close. If support breaks, it would do major technical damage. The K index is very weak. It looks to me like support will be tough to maintain.

Corn at the Crossroads

2007-06-18T20:53:00.001-05:00

The bulls have been let out the gate with corn futures. Dec futures has seen nearly a 70 cent rally since the May low of 356. As of Monday, June 18, we even traded contract highs on the open.

Fundamentals paint a pretty tight supply situation. Stocks to use ratios are very tight at 8%. Exports are running 114% of the three year average. However, national average basis is starting to weaken as the market rallies. The cash weakness suggests we are starting to rally past the zone of fair value.

Technically the market looks extremely overbought. On the bull side we are in an uptrend and MAs shows a strong buy. However, the weekly K Index shows us bearish divergence starting in October of last year. Dec futures themselves are at hefty resistance levels. Monday was able to trade above the highs but wasn’t able to close above it creating a bearish candle. RSI is way overbought at 91%. All this suggests at the very least a correction from the highs. Remember even strong bull markets need to correct. Corn is in need of it now.

Watch these areas closely. A close over 431 would give us another bull boost. Downside objective is a close below nearest support way down at 360. If moving averages trigger a sell, I’m a willing seller with lots of protection or a limited risk option scenario. I think we’re headed lower, but it remains to be seen if it will be a sustained move or simply a minor correction.

2008 Soybean Bull Spread

2007-06-03T14:04:00.001-05:00

The bean bull spreads (buy july old crop, sell nov new crop) have been beatin' up the past few years thanks to poor fundamentals. Remember, tight supplies make bull spreads roar. Large supplies make bear spreads roar. 2007 saw a huge supply of beans. We sat on stocks/use ratios in the 20% range. Ending stocks were a whopping 600 million bushels. There was tons of reason to bear spread that market. The best that spread traded at was +10 cents before falling to -30 cents.

Fundamentals could be changing. The latest USDA supply and demand report gave us a stocks to use ration at 10%. 10% is tight, but not extremely tight. The report gave us an ending stocks for next year at 320 million bushels. All this is due to the acre switch into corn.

Going back about 10 years and looking into similar fundamental situtations (10% stocks/use and 300 carryover) I can conclude that this spread under +10 is a bargin. Also, we're not even close to having this current crop in the bin. We aren't through the height of the weather scare which will help this spread even more. There's also a big question marks on the future of our bio-fuel industry. The bio-diesel industry hasn't yet reached the ethanol craze. Look what it has done for corn. Will that same insanity happen in the beans? If it does, bull spreads will be to the moon.

Keep a very close eye on the USDA supply and demand reports particularly the stocks/use ratios and ending stocks. If the USDA brings our stocks/use ration down even tighter and ending stocks lower, the July-Nov '08 bull spread will be off the the races. If the opposite is true, I feel this trade is fairly safe. The heaftiest of supplies should only push us to full carry around 25-30 cents. A 15% - 20% stocks to use doesn't give enough upside potential in this spread. It would be time to exit if that happens.

Trade Idea:

Buy July 2008 Beans, Sell November 2008 Beans

This spread deals with a crop that isn't all planted yet and one that hasn't even been thought of yet. It has a lot of what ifs, but I believe the potential of it to be profitable outweighs the opposite.

I'm using the minis once again. It takes a little more commision, but it gives me the option of averaging my positions without much loss if things start out against me. My initial position is at +5. If the spread sinks lower, I'm going to average my position by scaling in another mini spread around -5. I'll keep doing this until the market goes profitable or the USDA increases our bean supply enough that the upside on this spread would be limited.

Stay Tuned!

Cattle Breakout?

2007-05-29T12:07:00.001-05:00

Since its high back in March, the October cattle market has been chopping around between 98ish and 94ish. On the charts we are now seeing a triangle pattern which signals a major move is in the works. The direction of the breakout usually signals the direction of the move. If it breaks out of the triangle going up, the market tends to rally. If prices breakout of the triangle going lower, we are in for a decline.

The latest trade gave us a breakout lower. It certainly looks like the market will decline and test support areas. RSI is falling (bearish). MAs say to short. And we have a healthy downtrend established. I like the short side of the market. Watch the 94 level closely. If the market falls below that level, my next downside target is 89 which is 6 dollars away.

Trading Strategery:

At the moment my first trade is to short October Cattle and use the 97.2 resistance area as my target to exit the trade should the market go against me. I feel if the bulls push it over that resistance we could see a reestablished uptrend. If the market goes lower and the trade becomes profitable, eventually I'm going to look to buy a 96 or 98 call option for insurance. At that point I'll let things ride (hopefully lower still).

Happy Trading

Bean Short Strategy

2007-05-24T08:08:00.001-05:00

July Soybeans has taken out its downtrend and now is threatening to take out the most recent corrective move from early April. If this resistance area is taken out, the next upside target is the contract high of 820.

However, most indicators are very overbought. Fundamentally old crop supplies are huge. Stock/Use ratio is 20% for old crop with an even larger S. American crop coming online.

My bias is certainly to the downside. Mostly I'm a fundamental first trader, but I realize fundamentals mean nothing in a fund driven market. Watch the 800-820 area in July and the 830-840 area in November. If we fail to take out those resistance areas, I believe beans are in for a long downturn once again. If we take out those resistance areas, new uptrends will be established, and new corntract highs. The skys the limit.

My trading scheme is to buy call options (or call spreads) in the September contract fairly deep out of the money. Use those options as protection against mini shorts. Scale sell mini contracts every 20-30 cents higher until your short the same amount of bushels you have protected. A full option protects 5 minis. By the time the market hits your call option strike, you should have 4 or 5 minis shorted. When fundamentals rule the day, and the market starts taking a dive, you'll be short a full contract (5 minis). At the same time you'll be completely protected from any market rallys that go against you.

Forex Round up

2007-05-06T22:27:00.001-05:00

RSIs < 30

USD/CAD

RSIs > 70

EUR/JPY
GBP/JPY

MAs Shorts

EUR/USD
USD/CAD
AUD/USD
GBP/USD
NZD/CAD

MAs Long

USD/CHF
EUR/AUD
USD/JPY
EUR/JPY
GBP/JPY
CHF/JPY

My Version of the FX Shuffle

2007-05-06T16:08:00.001-05:00

It’s been awhile since I posted a Forex update for you. Since the last posting I am experimenting with anew trading scheme. The RSI method I have been using requires a lot of attention. It requires time that I sometimes don’t have to give.

I needed a quick and easy trading strategy that didn’t require too much attention. The first trading scheme I’m using is called the “shuffle” or griding. Essentially it is buying every 25-50 ticks lower and taking profit on those trades every 25-50 ticks higher. Or in reverse I am selling every 25 ticks higher and taking profit on those positions every 25 ticks lower. You can set the variables anyway you like, but I am doing a 50 unit / 25 tick profit shuffle. That is I buy 50 units every 25 ticks lower. At the time of trade a take profit order is placed 25 ticks higher. The strategy cashes in on the up and down movement of the markets. To make the trades even profitable, I trade only the interest positive pairs. That is I am paid interest on the positions I have. If a trade goes against me, and I keep buying every 25 ticks lower, at that point I am building an interest position. I don’t really care if it goes against me too much because I’m still collecting interest. The forex markets are perpetual, that is they never expire, so I never take a loss on any trade. I just keep buying every 25 ticks lower and keep collecting interest until my positions become 25 tick profits.

Here is an example of the short shuffle with the EUR/AUD pair। If you trade this pair short, you earn interest for the position.

Every red dot is a trade entry were I short 50 units of the EUR/AUD pair। Every green dot is a position exit were I take profit on those 50 unit trades approximately 20 ticks lower than the entries. You can see that the strategy really cashes in when the market is volatile. But if the market goes against my positions and I continue to add 50 units every 20 ticks higher, it's no big deal because I'm paid interest. The more units I have the more interest I collect.

Wheat Rally Skeptic

2007-04-26T13:11:00.001-05:00

There's a lot of wheat bulls out there riding the freeze damage wave, but technicals are looking weak. You can kill wheat dead and still raise a 30 bu. crop. I'm a bear short term before I'm a long term bull.

The top chart is the KIndex. The bottom chart is the daily wheat chart. Notice the bearish divergance showing up.

I like the RSI shuffle here. Sell the market every 20-30 cents higher if RSI is above 70. Take profits about every 20-30 cents lower. If the market is going higher and RSI isn't above 70, wait until it gets there.

Crop Progress

2007-04-25T09:06:00.001-05:00

Corn: Planting advanced 7 percentage points during the week to
11 percent complete by week’s end, behind last year and the normal
pace of 22 percent. In the Corn Belt, planting lagged well behind last
year and the 5-year average, with farmers in Iowa and Illinois having
8 and 13 percent of their intended corn acreage sown, respectively.
Planting had begun except in Minnesota and North Dakota, with
progress running behind normal in all States, except Colorado, North
Carolina, Tennessee, and Wisconsin.

Winter Wheat: Heading advanced to 16 percent, 8 percentage points
behind last year, but 1 point ahead of normal. The crop in Arkansas and
California advanced 29 and 15 percentage points, respectively, during
the week, with both States well ahead of their 5-year average. In North
Carolina, 31 percent of the crop was heading, 32 percentage points
behind last year and slightly behind average. Heading also gained
momentum in Oklahoma and Texas, where 45 and 39 percent of the
acreage was heading, respectively. Freezing temperatures early in the
month continued to hamper the progress of the crop in some States;
however, winter wheat conditions changed little from the previous week
in most States.

Website Update

2007-04-22T20:26:00.001-05:00

Until I come up with the perfect design for the AgTrader Market Idea website, consider me the mad tweaker.

On the frontpage you will find the familiar rolling ticker and quote menu at the top of the page. On the left hand side you will find the menus and links required to navigate the rest of the page.

Here is a rundown of the menus:
Daily Grain stats – Daily Cash Review, Spot Bids, LDP Rates, & COT Reports
AG Indices – Basis & Cash
Weekly Grain – Exports & Crop Conditions
Monthly Grain – Crop Production & Supply Reports
Yearly Grain – Production & Yield Trends
Market Research – My Commodity Research, Data Collection, K Index, & Trading Strategies

Below the menus are a few links including my NEW Ag Chartbook. The chartbook is a technical reference that I use to trade. The tools link is a collection of links to other commodity sites. I find these links very useful in trading. Lastly, the Professional Guessers is a collection of Professionals I like to read and watch. I consider them top of the industry.

Weekend FX Roundup

2007-04-07T16:57:00.001-05:00

RSIs >70
CAD/JPY
EUR/CHF
EUR/JPY
GBP/JPY
USD/JPY
Gold

RSIs < 30
None

MACD Bearish Divergances
AUD/JPY
AUD/USD
CAD/JPY
EUR/JPY
EUR/USD
GBP/CHF
GBP/JPY
GBP/USD
NZD/USD

MACD Bullish Divergances
EUR/AUD
USD/CAD

Trends (The trend is your friend)
AUD/JPY
Strong Uptrend
AUD/NZD
Weak Trend, Support @ 1.125 Resistance @ 1.145
AUD/USD
Strong Uptrend
CAD/JPY
Strong Uptrend
EUR/AUD
Strong Downtrend
EUR/CAD
Weak Trend, Channel Support @ 1.53 Resistance @ 1.57
EUR/CHF
Strong Uptrend
EUR/GBP
Weak Trend, Support @ .675 Resistance @ .687
EUR/JPY
Strong Uptrend
EUR/USD
Strong Uptrend
GBP/CHF
Strong Uptrend
GBP/JPY
Strong Uptrend
GBP/USD
Strong Uptrend
USD/CAD
Strong Downtrend
USD/CHF
Weak Trend, Support @ 1.2025 Resistance @1.2357
USD/JPY
Strong Uptrend
NZD/USD
Strong Uptrend

Comments:
Just in general these markets are pretty overbought. Just look at the RSIs and MACD divergances. There are a lot of bearish indicators to go around. This week saw good buying and a break in resistance on the AUD/JPY, EUR/CHF, and USD/JPY pairs. Markets to keep a close eye on are the GBP/USD and EUR/JPY pairs. These markets are right up against resistance. Take out resistance and we have a strong uptrend. Resistance holds and we have the beginnings of a downtrend. I’m also seeing head and shoulders out of the EUR/CHF and EUR/GBP charts. I think the EUR in generally overpriced. It’s a matter of time before she breaks. Did you notice anything from the RSIs? The JPY pairs are really going up versus the JPY. We’re going to have to see some sort of correction lower. If I had to pick and choose which one to sell, I like that EUR/JPY pair. RSI is high and we’re up against resistance and showing some divergance.

RSI SHUFFLE
The markets go up and the RSI shuffle keeps selling. That’s been the theme for a few weeks and is pretty evident in the account. The RSI shorts are seeing 81.16 dollars of margin being used versus 27.4 with the longs. I’ve never seen it this out of wack. The shuffle has been able to take profit from almost all long positions thanks to the buying spree. When these markets break lower, we are going to see a huge gain from the shorts. The margin will even out when that happens. Here are the stats:

RSI Shorts
WK % Gain – 4.8%
MTH % Gain – 9.5%
Yr % Gain – 31.42%

RSI Longs
Wk% Gain – 3%
MTH % Gain – 5.5%
Yr % Gain – 25%

Totals
Wk % Gain – 3.8%
MTH % Gain – 7.4%
Yr % Gain – 22.36%
57 Units Traded
Pace - 288% Gain

TRADE IDEAS - The Bean Mini Shuffle

2007-04-03T11:34:00.001-05:00

First, I feel it is wildly ridicules that beans are trading at 8 bucks given such bearish fundamentals. We are talking 20% stocks to use and a huge South American crop almost ready to come online. Exports have been decent 108% of 3 year average, but I believe that too will slow given high prices and S. America’s coming crop. I can see prices dropping like a rock possibly a dollar or more. I also can see more acres being switched to beans the more the bean/corn spread unwinds to normal conditions. I can also see a significant amount of acres being switched to beans if we continue to be wet.

But I don’t want to stick my neck out and nakedly sell the market either. The trend is still up although weak. If we take out resistance it could still have a considerable run. So, here’s what I’m doing.

I’m implementing the mini short shuffle. Mini contracts are 1/5 the size of a normal contract (1000 bushels). The shuffle is a strategy taught to me by a hedge broker friend of mine. Basically, you sell a contract and resell every 20 cents higher until she breaks lower and you are profitable. Sometimes it takes a fair amount of margin dedicated to this if the market keeps going higher. Money management is very key. Don’t half ass it in the middle of the strategy. You’ll loose every time. Sell a mini July bean now. If the market goes up you will want to sell another mini approximately 20 cents higher. At the moment I have my second mini sold. I’m willing to keep selling every 20 or 30 cents higher. July futures are showing pretty significant resistance at 821. If we break that resistance, I’m going to change my orders and sell every 40 to 50 cents higher. At that point the trend will become a strong uptrend and I don’t want to get in the way.

Just for insurance I have added an 800/840 call spread on for 13 cents. Honestly, they way I have things setup, I hope the market is able to go higher triggering a few more sells. The more positions I have on, the more I will make in the end.

Happy Trading

FX Opening Comments

2007-04-01T19:55:00.001-05:00

Good Sunday evening everyone.

Most of the FX markets are now open. Here are a few general comments.

EUR
I have to say that many of the EUR pairs just plain look toppy to me. EUR/CHF and EUR/USD is up against resistance. EUR/CAD and EUR/GBP are showing really nice bearish head and shoulder patterns. The EUR/AUD is the only pair that doesn't look like a great sell.

USD
I'm a semi bull on the dollar. Many pairs have seem a 50% correction from the latest trends and are now channeling. Some of the pairs are holding on support. Just watch support points. If we break them, it's going down more.

AUD
Looks overbought and against resisntances.

GBP
Like the dollar we are now nearing the 50% retracement on many pairs. I could go either way.

Happy Trading. I'll be back mid week for the roundup.

Weekend FX Roundup

2007-03-31T15:00:00.001-05:00

RSIs <30
None
RSIs >70
None

TRENDS (the trend is your friend)

EUR/USD
Strong Uptrend. Against resistance @ 1.3357. MACD Bearish divergence.
EUR/AUD
Strong Downtrend.
EUR/CHF
Strong Uptrend
EUR/GBP
Weak Trend. Resistance @ .6865 Support @ .6754
EUR/JPY
Weak Trend. Resistance @ 152.62 Support @ 150.71
USD/CHF
Strong Downtrend
USD/CAD
Strong Downtrend.
USD/JPY
Weak Trend Resistance @ 118.45 Support @ 115.15
AUD/USD
Strong Uptrend
AUD/JPY
Strong Uptrend. Against Resistance @ 96
GBP/USD
Strong Uptrend. Against Resistance @ 1.9677
GBP/JPY
Strong Uptrend
GBP/CHF
Strong Uptrend

RSI SHUFFLE WEEKLY STATS
I'm naming this strategy the RSI shuffle for it reseambles a trading strategy taught to me by a good friend and hedge broker.

RSI shorts won the battle for the week

RSI SHORTS
Wk % gain = 4.8%
Month % gain = 4.8%
Yr % gain = 26.46%

RSI LONGS
Wk % gain = 2.86%
Month % gain = 2.86%
Yr % gain = 21.97%

RSI TOTALS
Wk % gain = 3.4%
Month % gain = 3.4%
Yr % gain = 17.86%

Corn Fundamental Focus

2007-03-30T08:48:00.001-05:00

What does the latest planting projections mean to the fundamental numbers? Here is a look at one possible scenario.

Beginning Stocks 800m bushels
Production 12300m bushels
Total Supply 13050m bushels
Total Use 11800m bushels
Ending Stocks 1252m bushels
Stocks/Use 10.61%

Stocks/Use Supply Key

<11% Very Tight Supply
11%-18% Tight Supply
18%-23% Normal Supply
23%-31% Plentiful
>31% Excessive

Prospective Plantings

2007-03-30T08:07:00.001-05:00

Bearish Corn Bullish Beans Bearish Wheat

Prospective Plantings

Corn 90.454 Average Guess 88.061

Soybeans 67.14 Average Guess 69.167

Winter Wheat 44.505 Average Guess 43.982

Technical Corn Look

2007-03-27T12:08:00.001-05:00

I know we are up against a weather market here, and it could be a very volitile weather market, but here is a look at some interesting technicals on corn.

Starting with the K Index:
The chart below is the K Index since Apr of 1995. Notice how overbought the index is comparatively to other strong years. Even the 1995-1996 buying spree didn’t see the index as high as it is today.

Shorter term K Index hints at a weakening market as well.

Have a look at the next chart which is July 07. Notice the head and shoulder pattern. Also notice the market has now taken out the last corrective support. This market is in a strong downtrend with bears in control.

April Live Cattle

2007-03-27T10:22:00.001-05:00

The April cattle chart has busted out an island top (see chart).
Time is short for Apirl options (9days). Trying to sell the 99calls for 60 cents of better.

FX Roundup

2007-03-26T19:56:00.001-05:00

FX Roundup

A few Notes:

The AUD/JPY and AUD/USD pairs are way overbought. I like selling these pairs especially the AUD/JPY which is up against pretty hefty resistance. Same goes for the EUR/AUD pair, but that one would be a buy. EUR/AUD is against support and RSI is way oversold.

Watch the GBP/CHF. We’ve double bottomed and are looking at taking out the last corrective rally which is our resistance point. A pull back to enter longs could happen with RSI now overbought.

Most of the Pound pairs that I watch are also overbought specifically the GBP/USD were we are up against resistance. I like the sell.

Here is a run down of the stats:

RSIs >70 (overbought)
AUD/JPY
AUD/USD
EUR/CHF
GBP/CHF
GBP/JPY
GBP/USD

RSIs < 30 (oversold)
EUR/AUD

TRENDS: (the trend is your friend)

AUD/JPY
Strong Uptrend
AUD/USD
Strong Uptrend
CAD/JPY
Strong Uptrend
EUR/AUD
Strong Downtrend
EUR/CAD
Weak Trend Support @ 1.5353 Resistance @ 1.5678
EUR/CHF
Strong Uptrend
EUR/GBP
Strong Downtrend
EUR/JPY
Strong Uptrend
EUR/SEK
Channel
EUR/USD
Weak Trend Support @ 1.31 Resistance @ 1.3415
GBP/CHF
Strong Uptrend
GBP/JPY
Strong Uptrend
GBP/USD
Strong Uptrend
USD/CAD
Strong Downtrend
USD/CHF
Weak Trend Support @ 1.2049 Resistance @ 1.2354
USD/JPY
Weak Trend Support @ 115.695 Resistance @ 118.551
Gold
Strong Uptrend

Trade Ideas

2007-03-25T18:51:00.001-05:00

It's all about the spreads tonight.

Stock of the Month (part II)

2007-01-31T15:21:00.001-06:00

OK, I know that "Stock" of the Month is singular, so I should not have more than one stock pick. But in this case, I have two more stocks that I really like. Not necessarily for the "month", but over the next 6 months or so. BA and CAT. Boeing (BA) just reported impeccable earnings with a great forecast. Catapillar (CAT) has been beaten down the last few months and is finally once again showing strength. The technical charts for both stocks look great! And since they are members of the Dow Jones, well, that can't hurt either. Current prices: BA 89.56, CAT 64.07

Stock of the Month

2007-01-22T12:46:00.001-06:00

For all you investor savvys, my stock pick of the month is ADM, Archer Daniels Midland. Ethanol stocks have been beaten down to a crisp. True, oil is going down and corn is going up, but I have a hunch that the largest ethanol producer has hedged against that, so they will still see good profits for the next few months. Plus, legislation is in their favor. Current price: 31.89

Forex Roundup

2006-12-20T19:22:00.001-06:00

Just a midweek view of a few forex pairs I'm watching:

EUR/SEK
On the verge of breaking out of support and month old channel.

AUD/NZD
Trading on support now. Watch for breakout lower or support holding.

EUR/AUD
Looks weak. 1.67 area needs to hold or downtrend will be established.

EUR/CAD
Currently in a channel. Top end 1.535 bottom end 1.508.

GBP/USD
1-2-3 top formation. #2 point is 1.95. #1 point and stop at 1.985

USD/CAD
MAs show a weak sell. Long term trend is still intack. Playing the trends would require prices to plunge to initiate sell.

USD/JPY
Prices up against major resistance. RSI is overbought. I like the sell here and willing to scale sell into strength.

Happy Investing

Bob Needham - New Blog Contributor

2006-12-18T13:37:00.001-06:00

I would like to welcome my good friend and fellow investor to the forum. Bob has earned his masters in Ag Economics from U of A and brings a lot of ideas to the table. He’s also a stock investor magician which is something I know little about.

His first post is below. Enjoy.

Christmas Markets

2006-12-18T00:49:00.001-06:00

Greetings my fellow Americans! I am not a mad Lutheran nor a genius, but am posting my musings on here none-the-less via permission of the aforementioned. So, here's my thoughts:

Corn- not sure on direction. let the market speak. March looks like it may be making a head and shoulders. December appears a little bullish, but has resistance around 365. My thoughts are if March breaks the 361 support, it could tumble to a 50% retracement near 320. If support holds, and heads higher than its resistance at 378, it is looking very bullish.

Beans- appears downward. I think January and March beans are setting up for a nice head and shoulders. We'll see if that happens.

Bean Oil- down. I shorted BOF07 at 2880. Good profit in it so far, but I'm looking for lower prices yet. Two factors to keep in mind with BO: price of Beans and price of Oil. So far, both are in favor of shorting BO.

Wheat- short term up, trend is down. I think we could see a possible 20 cent correction in March wheat. After the correction, you may consider buying a put with strike price around the support. Then when the price drops down to support again, you will have the option of either buying futures or only maintaining the put, depending on the looks of the chart at that time. Or another option is buying a call now with strike about 20 cents out of the money, and then shorting futures when the price gets near the strike. Either method should be fine and make you more money than the Bush girls at South American Toga parties.

If you are a high roller, you may consider buying unleaded gas futures. I highly doubt gas prices will fall below $2.00, which means futures likely will go up. Futures are near pretty strong support so money is to be made if you dare use $6500 margin for it.

And now, moving from the Liberty Stable to Wall Street:

I am long CAT, VLO, WAG, IAAC, and ICE. I also recently bought AMD and they are my current recommendation. Also, it is not a buy yet, but I like ADM. Wait for the downtrend to end and form a basing period before jumping into them.

I think the market is fixing for a correction. Stocks go down in January (usually starting the downward spiral the last week of December) more often than they go up. Therefore, I am currently eying some stocks that are good shorts once the market takes a turn down. Until the DJIA and Nasdaq are correcting though, I do not recommend shorting.

Longer term, I believe we will continue to experience inflation pressures since commodities in metals, energies, and grains are at record highs and Federal spending is at record levels. The Feds will need to increase interest rates. But doing so will exacerbate the housing problem and could send the economy into a recession again. If the Feds don't raise interest rates to maintain housing, then I believe we will experience stagflation (recession via inflation). We may not notice much of a change, except that our hard earned buck does not go as far as it did 5 years ago. My prediction is that the Feds will opt for stagflation rather than sending housing into a tailspin. It is much less political and more discreet. And it could happen on the next administration's term rather than this one.

I am starting an investing business. Please contact me or the Lutheran mentioned above if interested in setting up an account.

Morning Market Watch

2006-11-01T10:15:00.001-06:00

Good Morning Everyone,

This is something I’d like to start doing every morning if time allows.

Grains were up overnight. Dec Corn + 2.25 Dec CBT Wheat + 3.25 Dec KC Wheat + 2.5 Nov Beans + 2.25

Looks like we’re pointed higher on the open.

Market to Watch

Dec CBT wheat looks ready to fall here. MAs system gave us a strong sell for yesterday with stops at 557.75. It also confirmed a 1-2-3 top pattern. I like the sell here. 50% retracement is 473 which isn’t far away.

Although not as weak, Dec KC wheat is also looking weak as MAs has given us a weak sell signal. A close under 516.5 would turn the sell into a strong signal with stops at 555.75.

With demand really having a tough go of it here, I think we have factored in a lot of bullish news. We’re set to go lower temporarily at least.

OCT Grandmill Analysis

2006-10-16T21:27:00.001-05:00

Beans		2006		2006		2006	2006	2006	2006	2006	2006	2006	2006
		Jan		Feb		Mar	Apr	May	Jun	Jul	Aug	Sep	Oct
Beg. Stocks		256		256		256	256	565	570	545	515	485	449
Production		3086		3086		3086	3086	3080	3080	3,010	2928	3093	3189
Total Supply		3346		3346		3346	3346	3649	3654	3,559	3446	3581	3641
Total Use		2841		2792		2782	2782	2999	2999	2,998	2996	3051	3086
Ending Stocks		505		555		565	565	650	655	560	450	530	555
Stock/Use		17.77%		19.87%		20.30%	23.3%	21.67%	21.80%	18.60%	15.00%	17.37%	17.89%

NOV Futures	High		Low		Settle
<10%	784.35		585.15		675.4125
10% - 15%	734.55		563.3625		603.825
15% - 19%	681.6375		529.125		544.6875
19% - 22%	656.7375		504.225		522.9
>22%	647.4		488.6625		510.45

CORN
U.S. Supply
		Jan		Feb		Mar	Apr	May	Jun	Jul	Aug	Sep	Oct
Beg. Stocks		2114		2114		2114	2114	2226	2176	2062	2062	2,012	1971
Production		11112		11112		11112	11112	10550	10550	10740	10976	11114	10905
Total Supply		13236		13236		13236	13236	12786	12736	12,812	13047	13135	12886
Total Use		10810		10835		10885	10935	11645	11645	11,735	11815	11915	11890
Ending Stocks		2426		2401		2351	2301	1141	1091	1,077	1232	1220	996
Stock/Use		22.40%		22.15%		21.50%	21.04%	9.70%	9.40%	9.17%	10.42%	10.24%	8.37%

DEC Futures	High		Low		Settle
<11%	299.2875		231.6225		255.045
11% - 18%	287.5763		226.4175		244.635
18% - 23%	283.6725		222.5138		240.7313
23% - 31%	281.07		219.9113		235.5263
>31%	271.9613		216.0075		223.815

Wheat
		Jan		Feb	Mar	Apr	May	Jun	Jul	Aug	Sep	Oct
Beg. Stocks		540		540	540	540	547	547	568	568	568	571
Production		2105		2105	2105	2105	1873	1814	1,806	1801	1801	1812
Total Supply		2730		2730	2730	2725	2515	2461	2,478	2474	2474	2488
Total Use		2118		2188	2188	2193	2068	2045	2,040	2040	2045	2070
Ending Stocks		542		542	542	532	447	416	438	434	394	418
Stock/Use		25.50%		24.70%	24.70%	24.25%	21.6%	20.3%	21.50%	21.27%	19.26%	20.19%

DEC CBT Futures	High		Low
<20%	468.385		375.1225
20% - 25%	462.1675		370.9775
25% - 34%	460.095		368.905
34% - 54%	451.805		364.76
>54%	447.66		360.615